City Gas Distribution

A Pioneer in City Gas Distribution in India

In the early 1990s, GAIL launched Pilot projects in Delhi and Mumbai leading to the start of commercial operation of city gas projects. Later on, CGD projects in these cities were rolled out through Joint Venture Companies (JVCs) namely Indraprastha Gas Limited (IGL) and Mahanagar Gas Limited (MGL). The impact of these ventures was remarkable from the onset and has transformed the lives of the people of these two cities.


Based on the success of IGL and MGL, GAIL has further set up six more CGD JVCs namely Bhagyanagar Gas Limited in Andhra Pradesh & Telangana; Aavantika Gas Limited in Madhya Pradesh; Central U P Gas Limited & Green Gas Limited in Uttar Pradesh; Maharashtra Natural Gas Limited in Maharashtra and Tripura Natural Gas Company Limited in Tripura.

GAIL Gas Limited, a wholly owned subsidiary of GAIL (India) Limited was incorporated on May 27, 2008 which is operating in Uttar Pradesh, Haryana, Madhya Pradesh, Rajasthan and Karnataka. Further, Joint venture companies of GAIL Gas Limited are implementing CGD projects in Andhra Pradesh, Uttarakhand and Goa.

Developing a competitive edge

With the constitution of Petroleum & Natural Gas Regulatory Board (PNGRB), which provides the legal framework for the development of the natural gas pipelines and city or local gas distribution networks, the implementation of CGD projects in various cities is being taken up in a phased manner, as and when the bids are called for by the Regulator. This has encouraged other entities to come into CGD projects and thus a competitive era in this field began.

Natural gas has gained significance over traditional fossil fuels in last two decades at global level and especially in India, it is emerging as fuel of choice due to its various advantages such as cost competitiveness, efficiency, environment friendly nature and thereby increasing its share in overall primary energy basket.

Primarily, natural gas is being used in fertilizer, power and city gas distribution sector. CGD network implementation is nothing but secondary distribution of natural gas to domestic, industrial and commercial customers through pipes as Piped Natural Gas (PNG) and in compressed form to the automotive segment as Compressed Natural Gas (CNG).

In the domestic segment, PNG is used as substitute of LPG and other more polluting fuels like coal, wood etc. In industrial and commercial installations, PNG replaces fuels like Furnace Oil (FO), Light Diesel Oil (LDO), Propane, Commercial LPG, Coal, Wood, Pet-Coke etc.

Looking at the various advantages associated with PNG and CNG, Govt. has taken up implementation of PNG (Domestic) connections and CNG corridor along major highways (National Highways / State Highways) in mission mode.

Last Updated: 30th May, 2017

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