The natural gas pipeline project undertaken by GAIL India has suffered a setback with the company cancelling contracts given to some entities for the execution of the work at various stretches in Tamil Nadu. The company was compelled to take the decision as the project failed to make headway in the face of surmounting problems.
Certain farmers’ organisations had opposed the laying of the pipeline through farmlands and the issue was discussed at various levels by the Tamil Nadu government. Later, the Tamil Nadu government maintained that the pipelines be laid along the national highway, which was not acceptable to GAIL. The matter was referred to court and a case is pending before the Supreme Court.
Gail had planned to lay pipelines from Kochi to Bangalore through Kanjikode and Coimbatore. Accordingly, out of the 900 km pipeline, about 300 km would have to pass through Tamil Nadu and 100 km through Karnataka. The land acquisition for laying of pipelines is being done under the Petroleum and Mineral Pipelines (Acquisition of Right of User in Land) Act, 1962. Under the Act, the owner will retain the ownership rights over the land and cultivation, other than planting of trees.
The cancellation of the work along the Tamil Nadu route will have its impact on the prospects of Petronet LNG Limited which has set up a re-gasification plant of 5 MMTPA (million metric tonne per annum) capacity at the Puthuvype here. The LNG terminal had raised high hopes on providing natural gas to bulk consumers in Kerala and neighbouring States.
Even as LNG terminals are being planned in Tamil Nadu and Andhra Pradesh, the Kochi terminal was expected to derive early advantage. On the contrary, the terminal is facing serious problems arising out of low capacity utilisation. Less than 10 per cent of the capacity is being used by the terminal now.
Sources in the LNG industry said it would require a political decision to change the scene in Tamil Nadu. With Bangalore having been connected to Dabhol LNG terminal in Maharashtra, the link from Kochi to Bangalore would have ensured the national grid connectivity which in turn would be useful for making use of the indigenous gas. The price variation between indigenous and imported gas has been a serious cause of concern and several industrial users have been hesitant to make a decision to switch over to LNG, considered the cleanest fuel of the current century.
