Press Release

GAIL (India) Limited 

GAIL, BPCL sign MoU for Cooperation

 

New Delhi, July 24, 2008.GAIL (India) Limited and Bharat Petroleum Corporation Limited signed yesterday a Memorandum of Understanding for cooperation in the areas of Natural Gas –Transmission and distribution, LPG Pipeline, City Gas Projects, Exploration & Production, use and marketing of Naphtha, Infrastructure Projects and Technology & Knowledge Sharing. The MoU was signed by Shri A.K. Purwaha, Director (Business Development), GAIL and Shri S. Radhakrishnan, Director (Marketing), BPCL in presence of Dr. U. D. Choubey, Chairman and Managing Director, GAIL and Shri Ashok Sinha, CMD, BPCL.

Speaking on the occasion, Dr. U D Choubey, CMD GAIL (India) Limited said he was very confident about the success of the partnership between the two organizations. 

 We have been working without any formal agreement and this MoU would give strength to this arrangement. IGL, he said, is an outstanding example of the successful cooperation between GAIL and BPCL. Even in E&P, he said we have a common outlook while for city gas, he said there could even be one JV/ holding company. instead of several separate JV companies.

 Mr. Ashok Sinha, Chairman Managing Director, Bharat Petroleum Corporation Limited said that this was a formalization of the partnership framework where the two organizations have already been working together effectively. There are various areas which are of common interest and we should work to each others strengths.  

GAIL and BPCL have agreed to cooperate and examine various options available for transmission/distribution of BPCL’s gas from different sources on ownership / contract carriage / common carrier basis through the existing pipeline network of GAIL and new infrastructure being created and planned by GAIL. Both companies have also agreed to cooperate each other in sourcing of Natural Gas/ LNG from overseas.

 Considering the economic and environmental advantages of pipeline transportation, both the companies have agreed to cooperate in developing LPG pipeline network from existing/ new production centers.

GAIL and BPCL are already partners in Joint Ventures (JVs) for implementation of city gas projects in Delhi and Kanpur. Further, incorporation of JV between GAIL and BPCL for implementing city gas projects in the important cities of Kerala and Karnataka is being taken up expeditiously. GAIL and BPCL (along with other companies) are also partners in one E & P block in Oman. The other areas identified by both companies for joint participation in future are oil & gas E&P and CBM bidding rounds in India and abroad, use of Naphtha from BPCL refineries as a feedstock for the expansion of GAIL’s existing petrochemical plant at Pata as well as the proposed petrochemical plants, participation in any infrastructure projects opportunity in areas of gas processing plants, refining units, pipelines etc. in India and Overseas and sharing of technology and knowledge bank.

The opportunities identified would be examined by a working group to be constituted by GAIL and BPCL. The working group shall put up proposals to a Steering Committee comprising representatives of both the organizations. Specific recommendations of the Steering Committee would be formalized which shall be implemented subject to approval by respective Managements.