Expect GAIL gas pipeline tender by end-June

Vol 14, PW 24 (02 Jun 11) Midstream & Downstream

Labour unrest is luckily not hitting GAIL plans to lay a 948-km gas transmission pipeline to evacuate R-LNG from the Kochi terminal to Mangalore and Bangalore.

Pipeline-laying contractors can expect a tender from GAIL later this month for Phase-II of this pipeline, which will see 24-inch and 30-inch diameters and a capacity to carry up to 16m cm/d of R-LNG. “Our projects department is preparing a tender that should be out by end-June,” confirms a senior GAIL source.

GAIL, he adds, will ask companies to submit technical and price bids within 45 days of the tender date so it can award contracts by September 2011. “We want to commission this phase of the Kochi pipeline by December 2012,” adds GAIL.

Delhi-based pipe manufacturer PSL has already emerged the best-bidder in a separate tender to supply steel pipe for a 734-km stretch of the Phase-II pipeline. GAIL conducted a ‘reverse auction’ between May 11 and May 19 to buy steel pipe for Phase-II and also selected Man Industries to supply pipe for a 7.2-km stretch; Surya Global to supply pipe for a 97.46-km stretch; Welspun to supply pipe for a 50-km stretch; and Essar to supply pipe for a 59.5-km stretch.

GAIL is expected to send Letters of Award (LoAs) to selected pipe suppliers shortly. PSL had an advantage over other bidders, adds a pipe manufacturer, because it has steel mills in southern India and can save on pipe transportation costs.

“PSL has three steel mills at Chennai and one at Vizag,” we hear. “All are working to full capacity.

” Selected pipe suppliers must begin deliveries to GAIL within 180 days of accepting the award.