Gujarat Gas wins Dahej-Vagra with Rs225cr bid

Vol 19, PW 16 (21 Apr 16) News in Brief

Gujarat Gas is widely expected to win control of the heavily industrialised and prized Dahej-Vagra area of Gujarat - one of the most promising of 34 areas offered in the 6th CGD licensing round where bids were received on January 15, 2016.

Early next month (May) the GSPC-owned gas retailer is expected to deposit Rs900cr ($135m) with the PNGRB as its Performance Bank Guarantee (PBG) after beating rivals Adani Gas, Mahesh Resources and Unison Enviro with a Rs225cr ($33m) offer when bids were opened on April 1. Under PNGRB rules a PBG equivalent to four times the amount bid is mandatory to ensure that winning companies meet their stringent pipeline, gas connection and CNG targets.

After Jamnagar, Dahej-Vagra is the most industrialised area in Gujarat, unlike the less attractive Amreli and Patan districts, which were also offered in the 6th CGD licensing round. For Amreli, Gujarat Gas bid just Rs8cr ($1.2m) to win the Saurashtra peninsula area while BPCL and GSPC joint venture Sabarmati Gas bid just Rs7.6cr ($1.14m) to win Patan in north Gujarat.