New Delhi , October 17, 2007: GAIL (India) Limited will form a Joint Venture Company for City Gas Projects in Vadodara. The Board of Directors of GAIL approved the formation of JV with Vadodara Mahanagar Seva Sadan (VMSS) in its meeting held in New Delhi today.

GAIL will have a 25 percent equity in the proposed JV, while VMSS will have 26 percent equity. The balance 50 percent equity will be held by strategic investors and public.

GAIL’s contribution to the JV shall be by way of management and technical skills, signing Gas Sale / Purchase Agreement and expanding CNG outlets network

VMSS is already supplying gas to domestic and commercial establishments in Vadodara and has an allocation of 1 lakh SCMD.

The existing infrastructure of VMSS and GAIL’s presence in Gujarat shall be pooled to promote City Gas and CNG in particular in Vadodara. The JV will be run by its own Boar which will have representation from both GAIL and VMSS.

MoU with RCF for Coal Gasification Project

GAIL will shortly be joining hands with Rashtriya Chemicals and Fertilizers Limited (RCF) for jointly exploring potential of proposed surface coal gasification project in Talcher. The Board of Directors of GAIL also approved the signing of a Memorandum of Understanding (MoU) with RCF in its meeting held in New Delhi today

Under the MoU, GAIL will carry out techno-economic study of a commercial coal gasification plant, whereas RCF will carry out the techno-economic study of a commercial plant for utilizing synthesis gas from the proposed coal gasification plant. GAIL and RCF will jointly evaluate the coal gasification potential for the fertilizer industry.

The project will help produce 7.76 MMSCMD of synthesis gas (equivalent to 3000 tonnes per day of ammonia). The estimated cost of proposed coal gasification project is Rs. 2400 crore. GAIL will focus on the production and marketing of synthesis gas which will be in line with its core function of gas handling.

About GAIL (India) Limited

GAIL (India) Limited is India's largest natural gas company having a market share of 78% in natural gas transmission and 70% in natural gas marketing. Apart from natural gas transmission, distribution and processing, the Company has diversified business interests in LPG transmission, petrochemicals, city gas projects and exploration and production activities. The Company has presence in countries such as Egypt, Myanmar, China and Oman.

GAIL is one of the leading public enterprises with a consistently excellent financial track record. Turnover and Net Profits during the last ten years has shown a compounded annual growth rate of 14 per cent. The Company recorded a Turnover of Rs. 16,047 crore and Profit After Tax of Rs. 2,387 crore in the year 2006-07.

GAIL owns and operates around 6700 km of natural gas pipeline transmission network with a capacity of 148 MMSCMD and is laying five new natural gas pipelines measuring 5000 km. involving a capex of nearly Rs. 20,000 crore which shall enhance the transmission capacity to around 300 MMSCMD in 2011.

About RCF

RCF is a premier Fertilizer Government Undertaking and has been selected to be a part of the Coal Gasification Committee by Ministry of Chemicals and Fertilizers