Why it's not a good idea to bid in Gujarat

Vol 14, PW 12 (02 Dec 10) Midstream & Downstream

‘Collateral damage’ is euphemistically used to describe civilians killed or injured in military conflict.

Companies who bid for Gujarat areas in CGD-III (see above) better beware they don’t become collateral damage too. PETROWATCH learns bidders interested in Bhavnagar and Jamnagar towns and the Kutch East and Kutch West areas of Gujarat could unwittingly get caught in the cross-fire between the gas regulator and GSPC Gas, which plans to bid in all these areas.

“Anybody who wins in Gujarat will face a severe backlash from GSPC Gas and the Gujarat government,” says one worried soul. “They will be seen as opposing chief minister Narendra Modi who has given GSPC Gas a mandate to supply gas in every corner of the state.

” GSPC Gas, he adds, has never heeded the Board and has merrily expanded its network wherever it wants in Gujarat with backing from the state government. Future bidders, he says, should blame the Board for their current dilemma, as it should have cracked down on GSPC Gas by now, or had the sense to not offer areas where GSPC Gas is operating.

“Let’s give GSPC Gas credit where it is due,” we are told. “It has taken piped gas supplies to villages lacking electricity and piped water.

” GSPC Gas is already supplying the Essar and Reliance refineries and their staff townships in Jamnagar district. “Only Jamnagar town is left,” we hear.

“Why would anyone sink Rs200cr ($43.4m) in a town with little industry and few vehicles” In Bhavnagar, GSPC Gas has already bought land for a city gate station and laid stretches of steel pipeline, while in the Kutch East area it has also laid a steel pipeline and is supplying gas to customers. “GSPC Gas will not stand idly by,” we hear, “and let anyone else win areas where it has spent money.