GAIL drops Tamil Nadu for Kerala in R-LNG plan

Vol 20, PW 5 (17 Nov 16) Midstream & Downstream

Despite Supreme Court support and an intervention on its behalf by oil minister Dharmendra Pradhan, GAIL realises it won't be laying a R-LNG evacuation pipeline through Tamil Nadu anytime soon.

Instead it has decided the only hope of reviving its underutilised 5m t/y Kochi LNG terminal is to focus on pipeline stretches through Kerala and Karnataka, where it enjoys strong support. "GAIL knows it will be at least two years before it is finally allowed to lay the pipeline in Tamil Nadu," says a source at Mecon, GAIL's project consultant.

"The 300-km stretch of the Phase-II pipeline through Tamil Nadu will come much later." GAIL has even renamed the project. Originally called the Kochi-Koottanad-Bangalore-Mangalore Pipeline (KKBMPL), GAIL has stripped out Bangalore because reaching Bangalore means crossing Tamil Nadu, where farmer protests encouraged by chief minister J.

Jayalalithaa have derailed plans. The new name is simply Kochi-Mangalore.

In Kerala however it's a different story, following a meeting between Petronet-LNG chief Prabhat Singh and chief minister Pinarayi Vijayan in July. "The Kerala government wants the pipeline developed fast," confirms Mecon.

"It believes gas sales can prove to be a major source of revenues there." Karnataka too, adds our source, is supporting GAIL to receive RoU clearances to lay the pipeline. By November 22, GAIL expects to receive bids under a reverse auction to lay a 131-km stretch from Koottanad in Kerala towards Mangalore.