Kakinada SEZ, a subsidiary of GMR Infrastructure Ltd., has signed a memorandum of understanding with the Andhra Pradesh Gas Development Corporation to get access to piped natural gas for its upcoming 10,500-acre Kakinada Special Investment Region.
APGDC Managing Director Raman Chadha and Kakinada SEZ CEO Challa Prasanna inked the MoU in the presence of Principal Secretary (Energy) Ajay Jain and others.
Ajay Jain said that providing natural gas for commercial use would spur industrialisation in coastal area and boost the economy as it is cheaper compared with some other fuels.
“This development will be a boon for gas dependent industries such as ceramics, glass, fertilisers and chemicals in this region. Since gas constitutes a major portion of their costs, a 30-40 per cent saving on gas price will yield significant competitive advantage. This is expected to attract significant overseas and domestic investments, giving a boost to ‘Sunrise Andhra Pradesh’ initiative,” Jain said.
The GMR’s industrial park lies 6 km away from the Kakinada-Srikakulam pipeline. APGDC has agreed to lay a spur line from the main trunk line to the industrial park premises for facilitating piped gas access to commercial and industrial customers.
As the authorised entity of PNGRB for laying, operating and expanding gas distribution network, APGDC is executing the Kakinada–Srikakulam high-pressure Natural Gas Pipeline to facilitate supply of natural gas for industrial use. The work for 90 km of Phase-I of the KSPL pipeline originating in Kakinada is under way.
APGDC and Kakinada SIR have assessed the requirement of gas of around 0.5 MMSCMD in the initial two years with subsequent ramping up to 2 MMSCMD in 10 years.
The GMR Group said that Kakinada SIR will benefit as the ONGC plans to invest $5 billion in its ultra-deep water DNW-98/2 field in the Krishna Godavari basin, which is expected to produce 15 MMSCMD of gas and have a land fall point near Kakinada.
The industrial park, located on the Vizag-Chennai Industrial Corridor, offers 8,500 acres of SEZ and DTA land with another 2,000 acres earmarked for a greenfield commercial port.
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