Press Releases
[New Delhi, 11th April, 2007]
GAIL and IndianOil ink MoU for JV in City Gas Distribution projects in West Bengal
New Delhi, 11th April 2007: GAIL (India) Limited and Indian Oil Corporation Ltd. have entered into an understanding for formation of a Joint Venture for City Gas Distribution projects in West Bengal. A MoU was inked today by Shri A K Purwah, Director (Business Development), GAIL, and Shri B M Bansal, Director (Planning & Business Development), IndianOil, in the presence of Dr. U D Choubey, CMD, GAIL, and Shri Sarthak Behuria, Chairman, IndianOil. This will be the second joint venture of GAIL and IndianOil for city gas distribution projects in India. The first JV, viz. Green Gas Limited (GGL), is already operational in Lucknow and Agra, and is planning to expand to other cities of western UP.
Speaking on the occasion, Dr. U D Choubey expressed great pleasure in having IndianOil as a cooperation partner. He said, "One of the high growth areas in gas markets in the future, particularly in the next decade, would be the city gas distribution area." Dr. Choubey further added, "We must also proactively move to other parts of India, where GAIL and IndianOil may work together".
Reiterating the focused business approach of the joint venture companies, Shri Sarthak Behuria said, "IndianOil and GAIL together are a winning combination and with the right mix of their individual competence areas, we are sure to attain success in the venture." Recalling his association with IGL (Indraprastha Gas Ltd.), he said that both IGL and MGL (Mahanagar Gas Ltd.) were success models that could be easily duplicated. "We need to make a success story out of the current effort and also work for the city gas projects abroad in Pakistan and Libya, where GAIL has shown keen interest," he added.
The scope of work of the joint venture includes distribution and marketing of CNG for vehicles, and Piped Natural Gas for domestic, commercial & industrial purposes. The company will also take up supply of Auto LPG as fuel for transport vehicles through greenfield Auto LPG Dispensing Stations.
The Joint Venture company shall source its requirement of Natural Gas from GAIL for the quantity allocated by the Ministry of Petroleum and Natural Gas. Additional gas over allocation shall be sourced from GAIL and IndianOil in the ratio of 50% each. The JV Company shall source its requirement of LPG from IndianOil or its affiliates.
The new JV will have 22.5 percent equity holding each by GAIL and IndianOil, five percent by the State Government or its nominee and 50 percent by strategic Investors / public / financial institutions.
From Left to Right, Dr. U D Choubey, CMD GAIL, Shri A K Purwaha, Director (BD) GAIL, Shri B M Bansal, Director (P&BD) IOCL and Shri Sarthak Behuria, CMD, IOCL on the occasion of Signing of MOU between GAIL and IOC for City Gas Projects for West Bengal