India’s largest gas utility GAIL plans to invest about $78 million to build LNG filling stations and boost the use of LNG as fuel in the country’s transport sector.
GAIL revealed the investment worth 6.5 billion rupees ($78.4 million) in a stock exchange filling issued on Thursday.
The firm said that the LNG business has potential to grow “substantially”.
“In order to drive benefits from this growth, GAIL has planned to enter into LNG retail sector by setting up LNG dispensing stations across golden quadrilateral/major national highways,” it said.
GAIL said it can take a central role in driving this growth and aims to capture 50 percent plus market share in next 5-6 years.
“This will help GAIL in the retail LNG sector, leading to increase in natural gas. By converting transport fuel from diesel to LNG, reduction in carbon footprint is envisaged,” the firm said.
GAIL did not provide further information.
Last year, the firm signed a memorandum of understanding with Shell Energy India, a unit of LNG Shell, to collaborate in various fields, including LNG for road transport.
GAIL owns and operates a network of over 16,000 km of natural gas pipelines in India.
It holds a stake in India’s largest LNG importer, Petronet LNG, which is also working on LNG filling stations, and the company buys volumes under long-term LNG deals, including from Qatar and the US.
GAIL also charters LNG carriers and operates the 5 mtpa Dabhol LNG terminal in India.
The firm recently signed a long-term deal to buy 0.5 mtpa of LNG for ten years from a unit of UAE’s energy giant Adnoc.
Prior to this contract, GAIL signed a long-term deal to buy 1 mtpa of LNG for a period of 10 years from energy trader Vitol.
