GAIL set up for transport, not marketing biz: Pradhan

Pradhan gave the response in Rajya Sabha on a written reply to a question on splitting state-owned gas utility GAIL India Ltd by separating its gas marketing business from its primary role as a transporter of gas.

Incorporated in August 1984 by spinning off gas business of ONGC, GAIL (India) Ltd owns and operates about 11,000-km of natural gas pipelines in the country. It sells around 60 per cent of natural gas in the country.

Pradhan said in 2006, the Government issued the Policy for Development of Natural Gas Pipelines and City or Local Natural Gas Distribution Networks.

"In the long run and with the maturing of gas markets, it is envisaged in the policy that the authorised entities will have transportation of natural gas as their sole business activity and will not have any business interest in the gas marketing or city or local gas distribution networks," he said.

Also, the policy and the provisions of the Petroleum and Natural Gas Regulatory Board (PNGRB) Act, 2006 provide for all entities authorised to lay pipelines including GAIL to provide mandatory open access to their gas pipeline infrastructure on common carrier principle at non-discriminatory basis.

This open access to third parties should be given at transportation rates determined by PNGRB, he said.

The minister, however, did not say either ways if the government was considering splitting GAIL.

GAIL, he said, was established for transportation, processing and marketing of natural gas and for establishing and managing gas pipelines and related installations.

At present, GAIL has about 11,000 km long gas pipeline network and is also developing about 3,500 km long pipelines projects in the country.