BPCL-GAIL JV to market CNG in Karnataka, Kerala

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Mumbai: With an aim to market compressed natural gas (CNG) and piped gas in Karnataka and Kerala, Bharat Petroleum Corporation (BPCL) and GAIL (India) will set up a joint venture, God's Own Gas Company (Go Gas), reported Business Standards.

Both the companies have signed a MoU for the Rs 400 crore venture. The equity structure of the JV will be similar to Indraprastha Gas, the gas supplier in Delhi.

While GAIL will own 22.5 percent stake in the company, BPCL will hold 22.5 percent, Kerala government will get 5 percent and the rest will be held by strategic investors and public and financial institutions.

"We are waiting for the gas to come from Petronet's Kochi LNG terminal," said Rajiv Mathur, general manager, business development, GAIL.

Petronet's upcoming liquefied natural gas (LNG) terminal in Kochi is facing delays. The terminal is now scheduled to be commissioned in 2011. It was expected to be ready by June 2010 after missing the 2009 deadline.

Petronet's Kochi terminal, which will be the country's fourth LNG terminal, will handle 5 million tonnes per annum LNG.

The Petroleum and Natural Gas Regulatory Board in November 2007 had proposed a competitive bidding process to select public and private entities for developing city gas distribution networks in the country.

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