Confusion on progress of Dahej to Uran gas pipeline

Vol 8, PW 1 (07 Apr 04) Midstream & Downstream

Confusion reigns over progress of GAILs 500-km gas transmission pipeline from Dahej to Uran.

We learn project consultant Engineers India has told the oil ministry that GAILs Dahej to Uran Pipeline (DUPL) project is on hold because of capacity under-booking. EILs report in a document titled, Status of 35 public sector petroleum projects as of February 2004, was submitted to the ministry last month.

Seen by PETROWATCH, it reports that: The project is under hold for want of capacity tie-ups with customers. It further states that GAIL management has given the go ahead for equipment tenders to begin construction.

However, orders will be placed only after achieving the required capacity and MOEF (ministry of environment and forests) clearance. When contacted, GAIL categorically denies any such development and insists that the Rs1, 100cr ($244.4m) pipeline is very much on schedule.

How can we put this project on hold asks a GAIL official. Tenders for nine pipes have already been issued.

He confirms that the project is yet to receive environmental clearance, but stresses that this is expected soon. Government clearances always take time.

This does not mean that we stop work. GAIL claims it is unaware of the EIL report.

He also refutes charges of capacity under-booking on the DUPL stretch. Let me tell you there are enough customers on the DUPL route, he said.

Gujarat and Maharashtra are the most energy starved states in India and GAIL is tying up customers in this region. GAIL claims that the commissioning of its 42-inch Dahej to Uran pipeline will coincide with the commissioning of Shells 2.5m t/y LNG regassification terminal at Hazira in December 2004.

We are in the final stages of discussions with Shell and will close the agreement in a few weeks time. On 3rd February, GAIL and Shell signed a heads of agreement in which Shell promises to book 3-5m cm/d of capacity through the Dahej to Uran pipeline, which is designed to carry 12m cm/d of regassified LNG.