Mundra to Delhi pipeline construction begins shortly

Vol 9, PW 14 (20 Oct 05) Midstream & Downstream

Two months from now in December, Hindustan Petroleum will begin laying its long-awaited 1050-km petroleum products pipeline from the Gujarat port of Mundra to markets in the capital Delhi.

Orders for 90% of the pipes have already gone out, a source tells us. About 900-km pipeline length will be supplied by PSL.

Ideally, HPCL would have awarded the entire contract to PSL, but its capacity was exhausted. For the remaining 150-km, HPCL is re-floating the tender.

HPCL has already received bids from Welspun, PSL, Saw Pipes and MAN for the coating contract. This tender will be awarded by the end of this month.

Under oil ministry guidelines for laying petroleum products pipelines, introduced in 2002, HPCL is bound by a strict completion schedule and will incur heavy penalties, including loss of its bank guarantee of more than Rs20cr, if it misses the completion deadline. As such it is going full speed to ensure that it is within time.

But HPCL faces obstruction along the route of the pipeline over plans to buy land to set up storage terminals and other facilities. It needs about 70 acres of land at Jaipur, Ajmer and Palanpur each to set up storage tanks and about two acres each at about seven other locations to put up sectionalising valve stations and cathodic protection stations.

Things are moving frustratingly slow, we learn. HPCL has been meeting all possible officials in each of the concerned state governments.

Most serious is obstruction from the Delhi Development Authority over the allotment of land at Tikrikalan on the outskirts of Delhi to set up storage facilities at the final point of the pipeline. Every month HPCL is meeting DDA officials but nothing seems to move.

This issue, will become critical in a months time. If HPCL does not get land at Tikrikalan it will terminate the pipeline at Bahadurgarh and lay a 40-km long railway line to the company-owned storage tanks at Shakurbasti (in Delhi).

Products will be transported by rail wagons from Bahadurgarh to Shakurbasti.

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