KOCHI: Six companies have responded to tenders invited for the development of the city gas distribution network in Ernakulam district.
Sources with the Petroleum and Natural Gas Regulatory Board (PNGRB) said the tenders for gas networks in 19 geographical stations were invited last October and opened couple of days ago.
Companies which have responded include Indian Oil-Adani group consortium, Bharat Petroleum Corporation Ltd (BPCL) , Esselgroup Siti Energy Ltd (SEL), IMC Limited and Synergy Fields Pvt Ltd.
Kerala Gail Gas Limited (KGGL), a joint venture between Kerala State Industrial Development Corporation (KSIDC) and the Gas Authority of India Limited (Gail) has also submitted bid.
PNGRB is carrying out technical evaluation of the bids. Selected companies will then be asked to submit financial bids. “The process will take some months,” an official with PNGRB said.
Of the 19 geographical stations, 14, including Ernakulam, have received good response. The PNGRB has given time till September 11 to submit bids for the five geographical stations where the response was poor. No sanction will be given to submit fresh tenders in the 14 stations where the response had been good. Interestingly, there were no takers for the project when tenders were invited three years ago.
Laying of pipelines, price of piped natural gas (PNG) as well as gas prices will be challenges faced by the city gas project, said experts. Even though trunk lines have been laid from the Puthuvype LNG terminal to areas like BPCL Kochi Refinery and to FACT, sub-lines will have to be drawn to individual flats and houses.
The price of imported LNG, which will be distributed as PNG, is higher than subsidized LPG. New pricing policies will have to be evolved to make PNG attractive to customers, experts opined.
They also point out that it will take at least three years for the PNG project to become operational. The gas pricing scenario may undergo drastic changes by then if the technology is developed to profitably extract shale gas which has been discovered in abundance in places like the US.
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