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Times of India: GAIL, Shell in pipeline tie-up

9 Mar, 2007

NEW DELHI: State-owned GAIL and Anglo-Dutch Shell have arrived at an agreement to share the pipeline link provided by the gas utility to the latter’s LNG (liquefied natural gas) import and regassification terminal at Hazira in Gujarat.

The two companies have initialled a broad framework of agreement for cooperation, which will help in transporting regassified LNG from Shell’s Hazira terminal to GAIL’s customers.

The pipeline link at Hazira has been completed and gas is likely to be pumped into it shortly. Under the agreement, the two companies will now work out the modalities for transmission of regassified LNG through GAIL’s pipeline, access of Shell’s regassification facility to GAIL, and long-term arrangements with regard to gas supply and distribution.

The framework emphasises the need for both companies to examine the complementary nature of their facilities and build cooperation around them for mutual benefit.

The agreement has the potential to provide gas to GAIL for utilising its transmission capacity, while at the same time assisting Shell to evacuate its LNG imports.

GAIL owns and operates a network of around 6,000 km of pipelines with a capacity to carry around 140 million cubic metres per day of natural gas across the country.

Currently, it transmits approximately 84 million cubic metres per day of gas through its cross-country pipeline network.

The company has declared a 25% special interim dividend for the financial year 2006-07. The company board approved the special interim dividend in view of the performance. The company has fixed March 12 as the ‘record date’for the purpose of determining the eligibility of the members of the company to the special interim dividend.

GAIL had earlier declared a 55% interim dividend for the financial year 2006-07 and has a consistent track record of payouts.

GAIL has disbursed dividend of Rs 4,540.31 crore (up to 2005-06) to the shareholders, including the government, which is more than five times the equity capital of Rs 845.65 crore of the company. The government’s holding stands at 57.34%.

In another development, the company has also signed an agreement with Indian Institute of Petroleum, Dehra Dun, for joint marketing of natural gas liquid to gas and gasoline (NTGG) technology.

The agreement was signed by director (business development) A K Purwaha and IIP director M O Garg in the presence of GAIL chairman U D Choubey.

The agreement between GAIL and IIP, which is a constituent laboratory of CSIR, has formalised a joint technology ownership and will facilitate commercialisation of the technology jointly.

A patent application for equal Intellectual Property Rights has already been filed in 2001 and the grant of patent is expected soon.

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