GAIL and GSPC keen on building KG basin gas pipeline

State-owned GAIL India and Gujarat State Petronet Corporation (GSPC) have submitted proposals to build a 1,400 to 1,500 km pipeline connecting the Krishna Godavari (KG) basin in the eastern coast to central India. The proposals have been made to the Petroleum & Natural Gas Regulatory Board (PNGRB).
The total cost of the project would be around Rs 4,000 crore to Rs 5,000 crore, depending on its route and diameter and the exact length of the pipeline.

The proposals are being evaluated by PNGRB, which would consult the upstream regulator, the Director General of Hydrocarbons (DGH) before giving approvals.
PNGRB chairman L. Mansingh said: "This pipeline has been proposed by the companies on the basis of improved availability of gas in the region. We are yet to approve the route after which bids would be invited."

A GAIL spokesperson said the pipeline, which is proposed to be built from Vijaywada in Andhra Pradesh to Bijapur through Nagpur, would enable easier transportation of gas from the Krishna Godavari basin to areas of northern India. It would also enable GAIL to strengthen Bijapur as its hub from where it operates the Hazira-Bijapur-Jagdishpur (HBJ) pipeline.
This would make transportation of gas from the east coast to north India easier for GAIL, which otherwise has to be routed from east to west and then to north.

For GSPC, the pipeline from Andhra Pradesh to Gujarat via Nagpur and Bhopal would enable it to prepare its pipeline grid for the gas output that is set to begin from its own KG basin block in the next few years. It would also help GSPC connect central India to its Gujarat gas pipeline grid.
However, Reliance Gas Transportation (RGTL), which is privately owned by Reliance Industries chairman Mukesh Ambani, has opposed the twin proposals claiming the proposed pipeline would lead to duplicity of work. RGTL runs the East-West Pipeline.

A spokesperson for RGTL said: "The company has developed the East West Pipeline connecting the KG basin in Andhra Pradesh to Bharuch in Gujarat. Other entities may connect the neighbouring regions by building spurs from our pipeline rather than building a new trunk pipeline, which may result in higher transportation cost to customers."
RGTL is expected to source gas from Reliance Industries' blocks in the KG basin while GSPC would source gas from its own block in KG basin. Sources said GAIL will be sourcing gas from other players like ONGC.