Fourteen killed in GAIL India gas pipeline blast and fire

By Nidhi Verma

NEW DELHI (Reuters) - Fourteen people were killed and 20 injured on Friday in a blast and fire at a gas pipeline in Andhra Pradesh, again raising safety concerns over the country's energy projects.

The fire broke out on a stretch of pipeline running through the village of Nagaram, engulfing buildings and burning victims to death, according to TV news footage and eyewitness accounts. Many such projects are opposed by villagers on safety grounds.

"The situation is very bad ... 14 people were burnt alive and 20 have been admitted to hospital with injuries," Yanamala Ramakrishnudu, state finance minister of Andhra Pradesh, told Reuters. He added that the fire had been brought under control.

Friday's incident was the most deadly in the Indian energy sector since August 2013, when 28 people were killed in a fire at Hindustan Petroleum Corp Ltd's refinery at Vizag in Andhra Pradesh.

Prime Minister Narendra Modi said victims and relatives would receive compensation. He said 200,000 rupees would be paid to relatives of the dead and 50,000 rupees for those injured, in addition to relief payments by the petroleum ministry and GAIL.

Elected last month by a landslide, Modi wants to accelerate major energy and infrastructure projects that have been blocked by planning delays.

The latest fire occurred in a pipeline operated by state-owned energy company GAIL (India) Ltd and disrupted supplies to a power station and closed two gas fields.

The 18-inch pipeline supplies 0.5 million standard cubic metres of gas a day to a power plant operated by Lanco Infratech Ltd. , GAIL spokeswoman Vandana Chanana said.

"We have made arrangements to supply gas to consumers through alternative pipelines," Chanana said.

State-run explorer Oil and Natural Gas Corp has shut two of its gas fields that were supplying the fire-hit pipeline, its head of exploration N. K. Verma said.

GAIL's shares declined 1.1 percent at 1:07 p.m. while Lanco Infratech's shares were down 1.3 percent.

Oil Minister Dharmendra Pradhan and Andhra Pradesh Chief Minister N. Chandrababu Naidu have ordered an inquiry into the blast and fire.

(Additional reporting by Sumeet Chatterjee in MUMBAI, Aditya Kalra and Tommy Wilkes in NEW DELHI Editing by Douglas Busvine and Michael Perry)