LNG supply may no longer be a pipe-dream

LNG supply may no longer be a pipe-dream
DARSHAN DESAI

GANDHINAGAR, JAN 4: In the next three to four years, all troubles regarding the LPG cylinder may well be a matter of the past in Gujarat. With the setting up of a gas grid in Gujarat, which is the only state in the country to have decided to do so, residents in all major towns and cities between Ahmedabad and Surat can hope for piped supply of natural and liquefied natural gas (LNG) by 2003-2004.

The Rs 25,000-million gas grid project, which envisages laying a maze of gas pipelines across a mind-boggling 2,500 sq km area, will complete its first phase by March 2003. It will involve laying a 525-km pipeline from the Gujarat-Maharashtra border to Vadnagar in north Gujarat. In second phase, likely to be completed by March 2005, a 600-km pipeline network will be laid across Saurashtra. Work is already in advanced stages to set up a pipeline network of 120-km between Hazira and Bharuch, and the main trunkline covering this belt is likely to be operational in a couple of years.

The project is being implemented by the Gujarat State Petronet Limited (GSPL), a company floated by the Government-owned Gujarat State Petroleum Corporation (GSPC).

The gas grid, for which the State Government recently approved an Ordinance granting a legal framework to regulate transmission and distribution of gas, would work as the vital link between suppliers of LNG and users, including independent power producers, bulk industrial consumers and local gas distribution companies.

Official sources in the GSPL informed that as much as four million metric standard cubic metres of gas would be required to feed the domestic and commercial consumers in the State, while current industrial demand is 26 MMSCMD. The total demand for gas has been estimated to be 45 MMSCMD by 2007.

At present, the Gujarat Gas Company is supplying piped gas for domestic use in Surat and Bharuch, while the Vadodara Municipal Corporation (VMC) buys gas from the Gas Authority of India and pipes it to households in Vadodara city. But the number of people who use it is negligible. In Vadodara, 20,000 residents use piped gas in certain areas, while in Surat Gujarat Gas caters to one lakh households and to 20,000 in Bharuch.

As much as 20 MMSCMD indigenously produced natural gas is supplied in Gujarat by GAIL and the GSPC, which could increase up to a maximum of 25 MMSCMD. The State also hopes to get as much as 20 MMSCMD LNG through the Dahej and Hazira LNG terminals of Petronet-LNG and Shell. By 2003-04, both companies are likely to get an additional 10 MMSCMD LNG each. The sources say Petronet-LNG is expected to import gas from Qatar, Shell is negotiating with suppliers in Oman.

GSPC sources deny that LPG companies would be hit hard with increased use of natural gas. They point out that an estimated 40 per cent of Gujarat's population depends on non-commercial fuels like wood and gas produced from manure. However, the percentage is going down with improved distribution of LPG in the rural areas and small urban centres with the entry of several private players. ``It will take long before piped gas reached the rural areas, and till then LPG is the only option,''said an official.