GSPC to foray outside Gujarat

Eyes expansion in Maharashtra, Rajasthan and AP

Gujarat State Petroleum Corporation (GSPC) is about to become the first state-owned gas distribution company to set up gas transmission and distribution network outside Gujarat.

GSPC has received proposals from the Maharashtra and Andhra Pradesh governments for help in setting up pipeline network similar to the one it's running successfully in Gujarat.

Rajasthan is the third state where GSPC has taken an initiative and proposed to set up gas distribution and transmission network in association with Reliance.

Interestingly, expansion of GSPC network outside Gujarat: in Maharashtra, AP and Rajasthan, amounts to challenging the monopoly of GAIL.

Saurabh Shah, minister for energy and power, Gujarat, confirmed the development, adding that no final decision has been taken so far by the state.

However, industry sources said GSPC has taken in principal decision on pipeline network in AP and Maharashtra and is awaiting decision from the Rajasthan government on its proposal.

While the Maharashtra government has engaged MIDC for detailed feasibility study of natural gas pipeline network project, the AP government has roped in IDF to study the project. The Rajasthan project is still in early stages but GSPC has conveyed its consent to the Rajasthan government to work with RIL.

"GSPC group company GSPL is operating over 800 km-long network of natural gas pipeline in Gujarat and it's capable of creating similar network anywhere in the country. So there is no reason why GSPC should restrict itself only to Gujarat," said sources.

GSPC is currently executing another 400 km of natural gas pipeline network in Gujarat which will increase the length of its network to over 1,200 km connecting most of the districts in the state.

Andhra Pradesh and Maharashtra are sitting on huge off-shore natural gas reserves. AP has Krishna-Godavari basin with huge gas reserves discovered by GSPC as well as Reliance.

GSPC is expected to pump its KG basin gas into the proposed pipeline network in Andhra Pradesh when it hopes to start production from its KG 17 well in early 2008, said sources. Similarly, Maharashtra supply may coincide with commissioning of the Kakinada-Uran pipeline of RIL, which will bring in gas from its KG6 block in KG basin.