OREANDA-NEWS. Even before state-run Gail formally begins work on Rs 9,000 crore Surat-Paradip pipeline, it has become a priced asset. In addition to IndianOil Corporation (IOC) which has been in talks with Gail since last November, three other state-run entities—Bharat Petroleum Corporation Limited (BPCL), Hindustand Petroleum Corporation Limited (HPCL) and Engineers Indian Limited (E IL) have evinced interest in buying stake in the 1,550-km natural gas pipeline which will run from Surat in Gujarat to Paradip in Orissa."We have IOC, BPCL, HPCL and EIL showing interest. But with every player wanting a larger share, we have to we resolve this issue and try to give equitable stake to everybody. We have not yet concluded the joint venture structure. We may do the same in the next few months," said B C Tripathi, Chairman, Gail India.

A senior IndianOil Corporation (IOC) official confirmed the company is still in talks with Gail to buy up to 30 per cent stake in the pipeline. HPCL and EIL also confirmed approaching Gail. Through equity investment, these players plan to secure capacity in the pipeline for their own use. Gail will hold 51 per cent stake in the venture.

Last April Gail secured rights to lay the pipeline which will connect west to east coast. The pipeline would have a capacity to transport up to 60 million standard cubic meters per day of gas. Gail will have 36 months to lay the pipeline and commission the same. Tripathi said Gail plans to compelte the 36-inch pipeline as per schedule, which is 2015-16. "We have already issued tenders and will meet deadline," Tripathi added.

The pipeline is to originate from Mora in Gujarat and would cover states of Gujarat, Maharashtra, Chhattisgarh and Orissa. Gail has a trunk pipeline network spanning around 11,000 km which it uses to market LNG—both domestically produced and imported— in the country. Gail owns and operates over 9,500 Km of high pressure cross country natural gas pipeline network and can handle 175 million standard cubic metres per day (mscmd).

Company is in process of significantly augmenting its pipeline network to reach every part of India. Within next 2-3 years, Gail will have a pan-India natural gas pipeline infrastructure spanning over 14,500 km and can handle volumes over 300 mscmd. It is investing USD 6 billion in creating Natural Gas infrastructure.