GAIL Gas To Start Distribution Projects In 17 Cities - June 3, 2008

GAIL (India) Ltd on June 2 said that its recently floated 100 per cent subsidiary GAIL Gas Ltd would begin city gas distribution (CGD) projects in 17 cities in the first phase. GAIL has recognized 230 cities for CGD distribution in phased manner. The company said, In first phase, 17 cities have been recognized to be taken up via its subsidiary company with authorisation from Petroleum and Natural Gas Regulatory Board (PNGRB).The subsidiary company was registered last week as a limited company with an initial equity of Rs 200 crore. Corresponding to this equity amount, debt shall be arranged amounting to Rs 300 crore. The business plan of GAIL Gas will be developed and presented to the board in three months. GAIL Gas will also start the compressed natural gas (CNG) corridor project, which involves an estimated capital outlay of Rs 35 crore for opening CNG stations along the highways. It is hoped that the subsidiary company will be more easily listed in future to give further upside as well as liquidity to GAIL. The subsidiary company will have a board of directors consisting of not less than four and not more than 12 directors