New Delhi, April 20, 2006.Referring to the news item appeared in The Financial Express on 20th April, 2006 headlined Gassed out! PSUs wait for next Pak opportunity, GAIL (India) Ltd wishes to clarify that the company had received a communication as early as 20th February 2006 from the Privatisation Commission, Government of Pakistan (GoP), regretting its inability to process GAIL's participation in the privatisation process of Sui Northern Gas Pipelines Ltd (SNGPL) and Sui Southern Gas Company Ltd (SSGL). No reason was assigned for this decision.

GAIL was informed about the GoP's decision well before the 11th March 2006, which was the last date of submission of the Statement of Qualification. It is in view of the above that GAIL could not participate in the project and not due to red tapism and bureaucratic delays as attributed to in the news item.

In January 2006, GAIL had received a communication from MOP&NG for the gas sector privatisation opportunity in Pakistan. The GoP intended to sell 51% of shares of these two companies, SNGPL and SSGPL. The opportunity was received from Price Waterhouse Coopers, India (PWC) on the request of their Australian partner, PWC Australia, which is the lead advisor to GoP in this matter. While deciding to submit the Statement of Qualification for participating in the privatisation process, GAIL concurrently sought details on the procedure for submission of Statement of Qualification from the Privatisation Commission of Pakistan. It was in response to this that the Privatization Commission of the GoP expressed regret about GAIL's participation in the process.