Ioc Appointed Nodal Agency For Natural Gas Imports From Dhaka

The government has rejected the claims of Gas Authority of India Limited (Gail), and appointed Indian Oil Corporation (IOC) as the nodal agency for the import and distribution of natural gas from Bangladesh.

The government has given its approval to IOC to sign the confidentiality agreement with Unocal Corporation, the US multinational which discovered natural gas in Bangladesh. Dhaka will give its approval for the export of natural gas only if the committee set up to study its requirement of natural gas, concludes that sufficient surplus gas will be available in the country for exports to India.

Oil and Natural Gas Corporation (ONGC), IOC and Gail have proposed to form a consortium to bring in natural gas from Bangladesh. The gas will be purchased at the Indo-Bangla border, and the consortium will lay a pipeline to bring it to the eastern and northern parts of the country.

Gail had staked its claim for being the nodal agency on the strength of having experience in the transporting and marketing of natural gas in the country. It had also argued that it had undertaken a large number of studies on bringing gas from Oman and Iran via onland and offshore pipelines.

IOC had said that it should be permitted to market natural gas in the region since the company's market share of liquid fuels would be majorly affected after the import of natural gas.

Earlier, when the government was told that only 10 million metric standard cubic metres per day (mmscmd) of gas would be available from Bangladesh and, from this quantity, 2-3 mmscmd would be utilised by a proposed power plant on the Indo-Bangla border, it felt that IOC might not be interested in being appointed the nodal agency.

However, IOC said it was willing to take on the job even if the quantity of gas was less.

Last month, Unocal managing director Ron Somers had said his company had proposed a $910 million gas export pipeline from north-eastern Bangladesh to the Delhi markets, along the HBJ pipeline.

The 1,350-km, 30-inch diameter Indo-Bangladesh natural gas pipeline would be capable of initially delivering an average of 5 billion cubic meters of gas per year, and the estimated pipeline tariff would be $1.37 per thousand cubic feet of gas, he had said.