GAIL wants to hike gas sales by 10% in Gujarat

Vol 19, PW 23 (28 Jul 16) Midstream & Downstream

GAIL is on a mission to ramp up gas sales in Gujarat by 10% or another 2m cm/d this fiscal by targeting new industrial customers.

High on the list is Suzuki Motor Corporation and three large car factories the Japanese company is planning at Hansalpur near Ahmedabad, together likely to produce 750,000 cars a year. Expect the first of the three factories to be commissioned by May 2017.

"Obviously we are targeting new car factories," says a GAIL source. "But the problem is that only Gujarat Petronet has a pipeline network in the region." If GAIL wins the Suzuki gas supply deal it worries that it will be hostage to a pipeline network owned by its longstanding rival.

Another company in GAIL's sight is fertiliser producer GNFC which has a factory at Narmadanagar in Bharuch district and which needs an additional 150,000 cm/d of gas under its Rs4463cr ($671m) expansion programme, cleared by the environment ministry in April 2015. Adani is yet another prize customer which already sources 250,000 cm/d from GAIL.

Yet Adani often takes gas from rival Gujarat Petronet instead, admits GAIL. Other potential targets include the Dahej Petroleum, Chemicals and Petrochemicals Investment Region and the Dahej Special Economic Zone as well as Essar's 500-MW gas-based Bhander power station at Hazira expected to restart in October.

GAIL already sells around 20m cm/d in Gujarat.

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