Gujarat Gas targets Bhavnagar and Kutch to expand

Vol 12, PW 12 (30 Oct 08) Midstream & Downstream

BG subsidiary Gujarat Gas has set its sights on building city gas distribution (CGD) networks to bring piped gas and CNG for vehicles to Bhavnagar and Kutch in Gujarat, which it has identified as the last industrial outposts in the state without gas.

Gujarat Gas applied to the Petroleum and Natural Gas Regulatory Board in September for the two regions, with details published on the Board’s website on October 6. Anyone with the same idea has 30 days to respond with rival offers.

“These are the only two economically viable regions for the CGD business left in the state where gas pipeline connectivity will be available soon,â€‌ says a Gujarat Gas source. “GSPC Gas has announced its intention to set up networks in all the other regions.

â€‌ Gujarat Gas already has a well-entrenched CGD business in the industrial hubs of Surat, Bharuch and Ankleshwar and hopes to repeat the same success in the two nearby regions. Kutch in particular, we hear, is seen as more lucrative, with demand expected to reach 1.16m cm/d by 2025 from 260,000 cm/d estimated now in the towns of Bhuj, Anjar, Bhachau and Gandhidham.

“Kutch is an evolving industrial hub in Gujarat,â€‌ Gujarat Gas tells us. “It includes two major ports at Kandla and Mundra and a mix of large and small factories making industrial and consumer goods.

â€‌ Workers are flocking to the area from across India leading to rapid growth of everything from hotel rooms and shopping malls to hospitals and bakeries - all potential users of gas. Gujarat Gas says these four towns put together have 7883 taxis and autorickshaws, 16,235 cars and 11,639 buses and trucks – all of which could use CNG.

Gujarat Gas says gas will come from the KG Basin and also long-term LNG and other sources that could be sent through Gujarat Petronet’s proposed transmission pipeline from Morbi to Surat. “This pipeline will be ready by the end of 2009,â€‌ we are told.

“If that was not the case, the regulator would not have considered our application.â€‌