City gas distribution bidding: Adani Gas gets 29% of allotted areas

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After the government came out with the list of successful bidders for 78 geographical areas (GA) in the ninth round of city gas distribution (CGD) bidding, Gautam Adani-led Adani Gas managed to win about 22 areas, or 29 per cent, of the allotted one so far.  

Out of the total 86 areas on offer, the Petroleum and Natural Gas Regulatory Board (PNGRB) has so far issued letters of intent (LOI) for only 90 per cent of the areas on offer. On Friday, the regulator gave its nod for issuing LOIs to ten successful bidders for 30 GAs. 

Friday’s development comes after the regulator issued LOIs to 18 successful bidders for 48 GAs on August 3. Another set of seven areas will be taken up for clearance on August 16 by the PNGRB, while one area is sub-judice. A total of 19 companies have been allotted their areas so far, out of which three are new entrants to the CGD business.

While Adani Gas independently managed to get 13 GAs, it won another nine in a joint venture with Indian Oil Corporation (IOC). IOC also got another seven GAs, where it submitted bids without having a tie-up with the Gautam Adani-led company. The second major bidder turned out to be Bharat Gas Resources that got 11 areas on its own. Sudhir Mehta-led Torrent Gas also got nine areas independently.

The current round of bidding covered 174 districts (156 complete and 18 in part), spread over 22 states and union territories (UTs).  PNGRB got a total of 406 bids from 38 entities on July 10, once the bids were closed. Of these, 37 were not considered on various grounds, including being “unreasonably low or high”. 

According to the commitment by various entities in the 78 GAs approved for issuance of LoIs in the current round, at least 15.3 million domestic PNG (piped natural gas) connections and 3,627 CNG (compressed natural gas) stations for the transport sector will be installed during a period of eight years up to September 30, 2026.

After eight rounds, the CGD authorisation has been granted by PNGRB for 92 GAs, covering 124 districts. Currently, the CGD network covers approximately 20 per cent of India’s population and 11 per cent of its geographical area. 

In addition, CGD operations are being carried out in five districts, authorisation for which is either under consideration of PNGRB or is sub-judice. 

With the completion of the ninth bidding round, CGD will be available in 178 GAs comprising 280 districts (263 complete and 17 in part) spread over 26 states and UTs, covering more than 50 per cent of India’s population and 35 per cent of its geographical area.

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