GAIL (India) Stock

GAIL (India) Limited operates as a natural gas processing and distribution company in India.

The company has a diversified business portfolio and has interests in the sourcing and trading of natural gas, production of liquefied petroleum gas (LPG), liquid hydrocarbons and petrochemicals, transmission of natural gas and LPG through pipelines, etc. The company has also participating interest in India and overseas in Oil and Gas Blocks.

The company operates through Transmission Services (Natural Gas and LPG), Natural Gas Trading, Petrochemicals, LPG and Other Liquid Hydrocarbons, City Gas Distribution, and Other (includes GAILTEL, E&P, and Power Generation) segments.

The company holds equity interests in two City Gas Distribution (CGD) companies in Egypt, namely Fayum Gas Company (FGC) and National Gas Company (Natgas), involved in the supply of natural gas to residential, commercial and small industrial customers in Egypt. The investment in Natgas was made through GGSPL. The company is also an equity partner in China Gas Holdings Limited (China Gas), a retail gas company involved in the city gas and CNG business in China.

The company has formed various subsidiaries / associates / joint venture companies for different business areas, such as City Gas Distribution (GAIL Gas Limited, Indraprastha Gas Limited, Mahanagar Gas Limited, etc.), petrochemical production (Brahmaputra Cracker and Polymer Limited and ONGC Petro-additions Limited), LNG/ Re-gasification (Petronet LNG Limited, Konkan LNG Limited (KLL), etc.), Gas trading (GGSPL), Power generation (RGPPL) and Shale gas (GGUI).

Natural Gas and LPG Transmission

In the entire value chain, the company has the responsibility of transmission of Natural Gas (NG) & LPG from source to customers through pipeline and Compressor/Pumping stations by following industry best practices, safety standards with integrated management. The company’s system of transmission of NG and LPG is supported by Supervisor Control and Data Acquisition system with central control system for overall monitoring.

Liquid Hydrocarbon

The company’s LPG plants converts the Natural Gas to its value added products i.e. Liquid Hydrocarbons. The plants are designed by adopting technology with best industry standards, practices and norms, such as OISD. The control system is adopted in all LPG plants. LPG is sold in bulk to LPG retailing companies (OMCs) and other liquid hydrocarbon products are sold to industrial customers for their consumption.

Petrochemicals (HDPE and LLDPE)

In the company’s petrochemical plant, ethane-propane (C2/C3) is recovered from natural gas in the Gas Processing Unit and is cracked in the Gas Cracker Unit to produce ethylene and propylene. Ethylene is converted to final products - HDPE (High Density Polyethylene) and LLDPE (Linear Low-Density Polyethylene) in the four polymer units. This procedure has resulted in the optimization of energy, raw material, water etc. for the desired level of production.

The company manufactures basic chemicals, fertilizer and nitrogen compounds, plastics and synthetic rubber in primary forms. The company engages in the extraction of crude petroleum and natural gas. The company also engages in the electric power generation, transmission and distribution business.

NG Marketing

The company marketed 49.21 MMSCMD (million metric standard cubic meters per day) domestic gas in 2020.

Fertilizer Sector: The company supplies majority of the gas consumed in the fertilizer sector. The company has tied up with various fertilizer users to supply around 12 MMSCMD of gas. During 2019, the company had commenced gas supply to Ramagundam Fertilizers & Chemicals Limited (RFCL).

Power Sector: The company supplies around 60% of the gas consumed by gas-based power plants in the country. The company has successfully partnered with various power producers to operationalize their stranded units. The company continues to explore opportunities for supply of natural gas to gas based power generation units at affordable prices and is supplying around 4.12 MMSCMD of RLNG to power plants apart from allocated domestic gas.

Natural Gas Transmission

The company owns and operates a network of around 12,426 kilometer (km) of natural gas pipeline across the length and breadth of country. The average gas transmission during 2019 was 108.37 MMSCMD.

LPG Transmission: The company owns and operates 2,038 km LPG pipeline network for LPG transmission namely Jamnagar-Loni Pipeline (JLPL) & Vizag Secunderabad (VSPL). JLPL and the VSPL pipeline networks achieved a throughput of 3.91 million metric tonne per annum during 2019.

Petrochemicals

The company has polymer production capacity of 810 KTA at Pata complex. The company’s subsidiary (70% equity share) Brahmaputra Cracker & Polymer Limited (BCPL) has a capacity of 280 KTA. The marketing right of the BCPL plant is with the company taking the total marketing portfolio to 1,090 KTA.

Further, the company has a joint venture with ONGC and GSPC, i.e. ONGC Petro- Additions Limited (OPAL), which has a 1,400 KTA capacity plant at Dahej. Overall production from the Pata Petrochemicals complex in 2019 was 788 KTA. A combined volume of approx. 1,000 KTA of polymers, including that of BCPL was marketed by the company during 2019. The company also exported 9 KTA of polymers to various Asian markets.

The company and BCPL together have a combined production share of 17.4% of the High Density and Liner Low Density Polyethylene (HDPE and LLDPE) market in the country.

LPG and Other Liquid Hydrocarbons (LHC)

The company has 5 LHC plants at four locations across the country having production capacity of 1.4 million metric tonne (MT). In 2019, total liquid hydrocarbon production was 1.266 Million MT, 90% of which was LPG and Propane.

Exploration and Production

The company is having interest in both domestic and overseas blocks. The participating interest is in 9 domestic E&P blocks and another 2 blocks in Myanmar (A-1 & A-3). The company is operator in two onshore domestic E&P blocks. During 2019, the company had made its first oil discovery in Cambay basin as operator.

Renewable Energy

The company is committed to reduce carbon emissions and implement renewable projects. Further, the company has a total installed capacity of 130.26 megawatt (MW) of alternative energy; out of which 118 MW are wind energy projects and 12.26 MW are solar energy projects. The company is implementing a 1.8 MW captive Solar Energy PV Project at Vijaipur unit in Madhya Pradesh.

City Gas Distribution

The company (including group companies) is authorized to operate in 61 geographical areas throughout India, including metro cities of Delhi, Mumbai, Hyderabad, Bengaluru, Kolkata, etc. These CGD networks together cater to around 66% of total 62.05 lakh domestic piped natural gas (PNG) connections in the country. Out of the total 2,207 compressed natural gas (CNG) stations in the country, the company’s group operates 1,385 CNG stations representing 63% share. In 2019, the company registered record addition of 9.52 lakh household PNG connections and 311 CNG stations.

The company was authorized to take up CGD projects in six cities as a part of PM URJA Ganga project namely, Varanasi, Bhubaneswar, Cuttack, Patna, Ranchi and Jamshedpur. Supply of gas has already commenced to CNG, PNG customers in Varanasi, Bhubaneswar, Cuttack and Patna, while supply of gas has commenced in Ranchi and Jamshedpur through cascades during 2019. The company is executing the CGD project at Kolkata through its JV - Bengal Gas Company Limited.

GAIL Gas Limited (GAIL Gas) (a wholly owned subsidiary of the company) is executing and operating CGD (City Gas Distribution) projects in 14 GAs, including Bengaluru. GAIL Gas has 07 nos. of JVCs and they are implementing CGD projects in 09 GAs. GAIL Gas along with its JVCs is providing DPNG to 4.64 lakh households and catering to clean fuel requirement for vehicles through its 166 CNG stations spread across various GAs.

During 2019, GAIL Gas along with its joint venture companies (JVC) had achieved around 1.63 lakh domestic PNG connections. During 2019, GAIL Gas along with its JV companies have also set up 81 CNG stations.

History

GAIL (India) Limited was founded in 1984. The company was incorporated in 1984.

GAIL (India) Limited operates as a natural gas company in India and internationally. The company engages in the exploration, production, processing, transmission, distribution, and marketing of natural gas.

The company produces LPG through fractionation, known as Straight Run (SR). It manufactures and markets downstream HDPE & LLDPE from natural gas cracking at its Pata (Uttar Pradesh state, India) unit. GAILTEL, the GAILTEL service arm of the company, provides GAILTEL services to mission critical in-house SCADA and ERP services apart from commercially leasing services to GAILTEL Operators and ISP’s across India. GAILTEL serves major the GAILTEL operators of the country, including HUTCH, VSNL, Airtel, Idea Cellular, Reliance Infocom, and Tata Tele services.