225 bids for city gas license in 50 cities

As many as 225 bids by companies such as Adani Gas, Indian Oil Corp (IOC), Torrent and GAIL Gas were received Tuesday at the close of bidding for city gas licences for 50 cities, official sources said.

Without disclosing the names of bidders, the Petroleum and Natural Gas Regulatory Board (PNGRB) said "about Rs 50,000 crore" of investment would be plowed in the cities offered for bidding for a licence to retail CNG to automobiles and piped cooking gas to households kitchens.

The cities on offer included Gwalior in Madhya Pradesh, Mysore in Karnataka, Ajmer in Rajasthan and Howrah in West Bengal.

"About 225 bids were received in respect of all the 50 geographical areas (GAs) offered in the 10th City Gas Distribution (CGD) bidding round. The technical bids would be opened between February 7 and 9," PNGRB said in a statement here.

PNGRB had offered 50 geographical areas (GA), carved out by clubbing adjoining districts in 14 states, in the 10th round of bidding for city gas licences.

Bidders were asked to quote the number of CNG stations to be set up and the number of domestic cooking gas connections to be given in the first eight years of operation. Also, they have to quote the length of pipeline to be laid in the GA and the tariff proposed for city gas and compressed natural gas (CNG), according to PNGRB.

The GAs, PNGRB said, cover 124 districts - 112 complete and 12 part - in 14 states and extends CGD coverage of 18 per cent of India's geographical area and 24 per cent of its population.

The bid round comes within months of the close of the 9th round, which was the biggest ever city gas distribution licensing round where 86 permits for selling CNG and piped cooking in 174 districts in 22 states and union territories were offered.

The government is targeting raising share of natural gas in the primary energy basket to 15 per cent from current 6.2 per cent, in the next few years and the bid rounds are aimed at fulfilling that objective.

They are also aimed at meeting Prime Minister Narendra Modi's target of giving piped cooking gas connection to 1 crore households, roughly triple the current size, by 2020.

Cities offered in the 10th round include Nellore in Andhra Pradesh, Muzaffarpur in Bihar, Kaithal in Haryana, Mysore and Gulbarga in Karnataka, Allapuza and Kollam in Kerala, Ujjain, Gwalior and Morena in Madhya Pradesh, Jhansi and Basti in Uttar Pradesh, Firozpur and Hoshiarpur in Punjab, Ajmer and Jalor in Rajasthan, Nainital in Uttarakhand and Darjeeling and Howrah in West Bengal.

Companies having a net worth of not less than Rs 150 crore could bid for GAs with a population of 50 lakh and more while the same for GAs with a population of 20-50 lakh has been proposed at Rs 100 crore.

The net worth eligibility goes down with population, with a Rs 5 crore net worth firm being eligible to bid for GAs that have less than 10 lakh population.