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Retail Gas : Global Business Initiatives

GAIL's current business activities aim to capitalise the company's vast experience in natural gas and related business and make maximum utilisation of the untapped business potential. Thus GAIL entered into strategic business alliance with two companies in Egypt - Fayum Gas Company S.A.E. involved in local gas distribution and Shell Compressed Natural Gas Egypt S.A.E. involved in retailing CNG.

Fayum Gas Company S.A.E. (FGC):
FGC was incorporated in 2000 for designing, financing, constructing, operating and maintaining a gas transmission and distribution network in the Governorate of Fayum on behalf of the Egyptian General Petroleum Company (EGPC) - national oil & gas company in Egypt / its successor Egyptian Natural Gas Holding Company (EGAS).

FGC signed a concession agreement with EGPC / EGAS for a period of 20 years. As per the agreement, FGC has to connect 25,000 domestic / commercial customers and three industrial customers in Phase 1 (2001-03) and 58,000 domestic / commercial customers and four industrial customers in Phase-II (2004-06). Outside the concession agreement, FGC signed an agreement with a major industrial user - Emisal. An additional 9,000 residential customers (Aboxa) are also being connected by FGC outside Phase I & II concession.

GAIL has 19% equity participation in FGC.

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Shell CNGE S.A.E. (SCNGE):
SCNGE was incorporated in 2002 for setting up CNG fuel stations to sell CNG as auto fuel and for setting up CNG conversion centers. SCNGE plans to build 30 CNG fuelling stations and nine conversion centers by 2007.

Currently, 35,000 taxis of around 300,000 taxis in Egypt (of which around 110,000 are in Greater Cairo) are running on CNG. Hence there is a large potential market for CNG in Egypt.

Today as a result of these initiatives, GAIL is poised to become a Multinational Corporation. Moreover, GAIL's expertise and achievements in the area of gas sector development has been recognised by both private companies and government agencies.

GAIL's equity participation in SCNGE is 22%.

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