Government approves over Rs 5000 crore fund for North East natural gas grid project

The
Government has approved ‘Viability Gap Funding’ worth Rs 5000 crores to set up
a natural gas pipeline grid in the North East. The Cabinet Committee on
Economic Affairs gave its approval to the project on January 8, 2020.

Under the
project, a capital grant worth Rs 5559 crores will be provided to Indradhanush
Gas Grid Limited to build a natural gas pipeline grid covering eight north
eastern states.

This is the
second such funding approved by the Union Government for a gas pipeline
project.

North East
Natural Gas Pipeline Grid: Key Highlights

The Natural
Gas Pipeline Grid will be developed in the eight states of the north east
including Sikkim and the seven sisters- Assam, Arunachal Pradesh, Manipur,
Meghalaya, Mizoram, Nagaland and Tripura.

• The total
length of the pipeline will be 1656 km. It will connect Guwahati in Assam to
other major cities in the region such as Agartala, Aizawl, Kohima, Imphal,
Dimapur and Itanagar.

• The
pipeline grid will bring reliability and ensure uninterrupted natural gas
supply to the consumers, which otherwise gets majorly affected in the north
east due to several reasons.

• The
Government will be setting up a committee comprising officials from various
central departments such as Petroleum and Natural Gas Ministry, Expenditure
Department, Environment Ministry, Department of Fertilizers and the Ministry of
Development of North East Region to effectively monitor the implementation of
the project.

• The
committee will be required to review the progress of the grid project from
time-to-time and take steps to sort out any issues faced during the execution
stage.

Benefits:

• The availability of natural gas
  across the north east will help boost industrial growth in the region.

• It will also be environment-friendly
  and would offer a better quality of life to people due to the use of cleaner
  and green fuel and reduction in the usage of wood and kerosene.

• It will also boost production and
  exploration activities in the region and help connect regional gas sources with
  pipeline network for early monetisation of natural resources in the region.

• It will also open the possibility of
  installing bottling plants for LPG in the region to reduce transportation
  costs. The uninterrupted supply of LPG will bring energy security to the people
  living in the region.

The Natural Gas Pipeline Grid project is a significant step towards
achieving the central government’s Hydrocarbon Vision 2030 for the North-East.

The Government aims to bring in a gas-based economy and increase the share
of natural gas in the country’s energy mix. For the same, the government has
been taking several steps to enhance domestic gas production and enable
expeditious development of gas infrastructure including pipelines, city gas
distribution networks and re-gasified liquefied natural gas terminals and
development of a gas market by giving access to gas infrastructure.

The Indradhanush Gas Grid Limited (IGGL) has been set up as a joint
venture company of five CPSEs – ONGC, IOCL, OIL, GAIL and NRL to develop and
operate natural gas pipeline grid in the north east. It was set up in
2018.