KSIDC, Gail India form JV for gas infra

The Kerala State Industrial Development Corporation (KSIDC) has signed a shareholders' / promoters' agreement with GAIL Gas Ltd for setting up gas-based infrastructure projects in the state.

The agreement, valued at Rs 1,000 crore, was signed in the presence of the Kerala chief minister Oommen Chandy in Thiruvananthapuram by KSIDC managing director Alkesh Sharma and Gail Gas CEO M Ravindran on Friday.

KSIDC will have 24 per cent equity in the new company and GAIL Gas, a fully-owned subsidiary of Gail India Ltd, will have 26 per cent. The balance will be held by a strategic investing partner, according to a KSIDC press release.

The new company, Kerala Gail Gas Ltd, will take up city gas distribution (CGD), laying of spur lines (providing last mile connectivity) for various locations, CNG stations, skill development centre, gas equipment retailing, power generation, optical fibre cable infrastructure, among others.

KSIDC has been engaged in developing a supplementary gas infrastructure and city gas distribution by developing spur lines from GAIL's gas trunk pipeline network and various gas-based infrastructure projects.

KSIDC has been associating with GAIL India for setting up the gas trunk pipeline for supplying re-gasified LNG in Kerala from Petronet LNG. The Kochi-Bangalore-Managlore pipeline with a length of 1,100 km and Kochi-Kayamkulam of 100 km are the main arteries of the gas trunk pipeline infrastructure in the state. The above project is estimated to cost Rs 4,000 crore. The Petronet LNG project is expected to be commissioned in 2012.

It said the discussions with Kerala State Transport Coroporation on introduction of CNG buses were also making progress, while a five-acre site has been earmarked at Angamaly in Ernakulam district for the skill development centre of the JV company.

Distributed power generation units are also being planned to tide over the acute power shortage faced by industrial units, particularly in industrial parks. The total cost for development of supplementary gas infrastructure is estimated at Rs 1,000 crore over a period of five years.