Indian Oil Corporation (IOC), the nation's largest oil firm, on Sunday said it will invest over Rs 7,000 crore in setting up city gas distribution networks in the cities for which it has secured a licence in the latest bidding round.
IOC secured 33 per cent of the demand potential that was up for grabs in the recently concluded 11th round of CGD bidding, cornering cities from Jammu to Madurai to Haldia, the firm said.
Of the 61 geographical areas or GAs that received bids in the 11th round city gas distribution (CGD) bidding, IOC got 9 licenses to retail CNG to automobiles and piped cooking gas to households. Though the GAs it won were less than Megha Engineering and Infrastructures Ltd's 15 licences and Adani Total Gas Ltd's 14, in the terms of demand potential it got the maximum.
"The nearest competing bidder was left with less than 20 per cent of the demand potential in the bidding round in which IOC bagged 9 out of the 15 high potential GAs," the firm said in a statement.
"With this substantial win in the 11th bidding round, IOC and its associates would service almost 28 per cent of the combined CGD potential in the 3 rounds of bidding till now, which is far ahead of the next major player."
The Petroleum and Natural Gas Regulatory Board (PNGRB) last week opened the bids and decided on preliminary winners.
IOC's acquired GAs include major districts like Jammu, Pathankot, Sikar, Jalgaon, Guntur (Amravati), Tuticorin, Tirunelveli, Kanyakumari, Madurai, Dharmapuri and Haldia (East Midnapore).
These districts contain high demand customers across the industry-commercial-domestic spectrum for PNG (Piped Natural Gas) and CNG (Compressed Natural Gas).
"IndianOil plans to invest over Rs 7,000 Crore in these new CGD Projects, over and above the Rs 20,000 crore already planned for its CGD Vertical," the statement said.
Speaking on the occasion, IOC Chairman Shrikant Madhav Vaidya said the company has a proud legacy of always aligning its growth agenda with national priorities.
"And our concerted efforts to expand the gas business across the length and breadth of the country reflects our commitment to realise the Government's vision of raising the share of natural gas to 15 per cent," he said.
"Gas will play a significant role in India's march towards a low carbon future as part of its Panchamrit pledge during COP-26 summit to reduce total carbon emissions by one billion tonnes from now till 2030."
Reflecting on the latest developments, Vaidya said IOC's "intelligently aggressive" approach in the latest CGD bidding process has been able to secure nine high market potential GAs that cover 26 districts spread across the country.
"And with this, IOC is poised to emerge as a dominant player in the Indian CGD market."
After the 11th Round of CGD bidding, IOC along with its two joint venture companies is now present in 49 GAs and 105 districts spread across 21 states and UTs, making it one of the most significant CGD players in the country.
On a standalone basis, IOC will now have a presence in 26 GAs and 68 Districts spread across 11 states and UT covering nearly 20 per cent of the total CGD market potential in GAs announced recently in 3 bidding rounds.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)