Monday, June 15, 2009

GAIL, RIL arm set to pay for delay

State-run GAIL (India) Ltd and Reliance Gas Transportation Infrastructure Ltd (RGTIL) have been threatened with punitive action in the case of a delay in execution of projects.

While GAIL may lose authorisation for operating major trunk pipelines across the country due to delays in laying them, RGTIL has been asked to advance the 2012 deadline for the completion of its four-trunk pipeline projects, an official in the ministry said requesting anonymity.

The government will review progress of all major pipeline projects every six months, he said.

In a recent meeting, the oil ministry issued a warning to the two companies: “In the case of inordinate delay in execution of these projects, the performance guarantees may have to be forfeited, and issue of fresh authorisations through the bidding process may have to be considered.”

A GAIL spokesperson declined to comment on the issue.

GAIL has authorisation to lay four major trunk pipelines—Dadri-Bawana-Nangal (95 km), Chainsa-Jhajjar-Hissar (104 km), expansion of Dahej-Vijaipur (DVPL) and Gas Rehabilitation and Expansion Project (600 km) and Haldia-Jagdishpur (300 km).

The ministry has directed RGTIL, a wholly-owned subsidiary of Reliance Industries (RIL), to revisit its schedule and advance the completion dates, “especially for the Kakinada-Howrah pipeline as the completion of GAIL’s Jagdishpur-Haldia pipeline is also dependent on them”, an official present in the meeting said requesting anonymity.

In a presentation to the government, the company had set third quarter of 2012 as the target for completing the pipeline. The government had authorised the company to lay the pipeline in June 2007.

Replying to an email query, an RGTIL spokesperson denied that there was any delay in executing the pipeline projects. A detailed route survey has been completed and the process of statutory approvals and right of use (RoU) acquisition is in progress, he pointed out. “We are confident that these pipelines will be completed in synchronisation with gas availability to transport gas to various demand centres in respective regions,” he added.

The pipelines in question are the Kakinada-Chennai pipeline (600 km), Kakinada-Basudebpur-Howrah pipeline (1,100 km), Chennai-Tuticorin pipeline (670 km) and Chennai-Bangalore-Mangalore pipeline (660 km).

“The above pipelines will be completed by 2011-12 in phases,” the spokesperson added.

The oil ministry has directed GAIL to complete all pipelines by 2011, a company official, who did not wish to be named, said.

GAIL had proposed that by 2011-12, it would complete the Chainsa-Hissar, Haldia-Jagdishpur and Dabhol-Bangalore pipelines.

The company told the ministry that the Kochi-Bangalore-Mangalore pipeline would be ready by March 2012 with the completion of the Kochi liquefied natural gas (LNG) terminal.

No comments: