GAIL signs agreement with Shell Energy India on ethane sourcing

GAIL (India) Limited has signed a Memorandum of Understanding (MoU) with Shell Energy India Private Limited to explore prospects of importing and handling of ethane and other hydrocarbons. 

It is primarily used as petrochemical feedstock and is separated from the other components of natural gas in most well-developed gas fields. In a bid towards diversification of the feedstock for its petrochemical plant, country’s largest gas firm is looking to import ethane from ethane-surplus countries with matured export terminal infrastructure, GAIL announced on Friday. It will be transported further through GAIL’s 14,830 km of natural gas pipelines to demand centres.

Reliance Industries has also begun to import ethane from the United States (US) to replace natural gas and naphtha as fuel at its petrochemical plants. Ethane is expected to be produced in large volumes in North America due to the shale gas revolution, which has generated an abundance of liquefied natural gas (LNG) and liquefied petroleum gas (LPG).

Ethane is mainly used to produce ethylene, which is then used by the petrochemical industry to produce a range of intermediate products, most of which, are converted into plastics, packaging films, wire coatings, squeeze bottles and synthetic rubber, among others.