New Delhi: The largest gas utility in India, GAIL, announced on Friday that it has reached a deal with Shell Energy India Pvt Ltd to investigate potential for ethane sourcing and other aspects of the energy value chain. To replace natural gas and naphtha as the feedstock at petrochemical plants, GAIL intends to import ethane from the US.
GAIL said in a statement that it and Shell Energy India had inked an agreement to "examine prospects for infrastructure development for ethane sourcing."
GAIL floated a tender last month to contract a VLEC (very large ethane carrier) for 20 years beginning in the middle of 2026 to import ethane from the US. The ship, which can carry between 80,000 and 99,000 cubic metres of ethane, is intended to transport it from the US ports of Marcus Hook, Nederland, Morgan's Point, or Beaumont to Dahej, Hazira, or Dabhol in Gujarat or Maharashtra.
GAIL is aiming to build another unit at Usar in Maharashtra in addition to its petrochemical facility at Pata, close to Kanpur in Uttar Pradesh.
Because the government shifted gas supplies from the plant to municipal gas suppliers, the firm had to reduce operation rate at Pata. This had an effect on its profitability, thus the company is now exploring to add ethane as a feedstock supplement.
In a statement following the signing of the Memorandum of Understanding with Shell Energy India, GAIL stated that this was a step towards improving sustenance in commercial operations.
"GAIL is planning to import ethane from ethane-surplus countries with established export terminal infrastructure through water-borne transportation to India and transport it further through GAIL's pipeline networks to demand centres," according to the statement.
According to the statement, the MoU aims to investigate opportunities in the import and handling of various hydrocarbons, which are crucial chemical and petrochemical precursors, LNG for road transportation, regasification of imported LNG, and renewable energy.
The largest natural gas company in India is GAIL. It is the owner and operator of a network of 14,830 km of natural gas pipes that spans the entire nation. It controls over 68 percent of the gas transmission market and sells 53% of the nation's gas.
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