Bid & Tender
UGGPP: Energy for Eastern States May Be Ready for Delivery by 2020

Date : Aug 21, 2017

Prime Minister Narendra Modi’s Urja Ganga gas pipeline project (UGGPP) seems on course to achieve the target of meeting the energy requirements of 40 districts and 2,600 villages across five eastern states by December 2020.


After steady progress in Section 1 of the project — between Phulpur and Dobhi with spurlines to Varanasi, Gorakhpur, Patna and Barauni — construction work on sections 2 and 3 is expected to commence by December this year. Launched in October 2016 to supply gas to Uttar Pradesh (UP), Bihar, Jharkhand, Odisha and West Bengal, the 2,539-km-long pipeline project, also known as the Jagdishpur-Haldia/Bokaro-Dhamra Pipeline (JHBDPL), is estimated to cost Rs 129.40 billion.


Urja Ganga would create enabling infrastructure for city gas distribution (CGD) in seven cities — Varanasi, Bhubaneswar, Cuttack, Kolkata, Patna, Ranchi and Jamshedpur. It would also revive three large fertiliser units at Gorakhpur (UP), Barauni (Bihar) and Sindri (Jharkhand) and help industrialise at least 20 cities. Meeting the gas requirements of the Talcher fertilizer unit in Odisha is another of its objectives.


“The project has a lot of forward and backward linkages. The proposed CGD network would help the government curb the subsidy it provides through LPG. Most of the CGD would operate on imported liquefied natural gas, benefitting companies like Petronet LNG,” says Vivek Jain, associate director, India Ratings and Research Pvt. Ltd, a rating agency.


For section 1, Gas Authority of India Limited (GAIL), the executing agency, has acquired the right to use (RoU) for a stretch of 389 km. In addition, welding of 309 km of the pipeline has been done and 246 km has been lowered. CGD work in the seven targetted cities has also been initiated, with the construction of steel pipelines having started in Varanasi, Bhubaneswar, and Cuttack. The Greater Calcutta Gas Supply Corporation is collaborating on the project in the capital of West Bengal.


While section 2 of the project would include the Dobhi-Durgapur and Dhamra-Angul stretches, section 3 would include the Bokaro-Angul-Durgapur-Haldia stretch. “The project is proceeding as per schedule and no time and cost overrun is envisaged as of date. In section 1, pipeline laying work is in progress and physical progress of 53.2% has been achieved. In sections 2 and 3, detailed route survey has been completed, and the acquisition of RoU, permanent land and tendering process is in progress,” says a GAIL spokesperson.


The process for procurement of materials has also been expedited, he adds. According to Jain, the pipeline is critical for GAIL to maintain its leadership in the sector. Forty per cent of the total project cost or Rs 5,176 crore would be provided as budgetary support, making it the first time the government — which wants the gas-deprived eastern parts of India to contribute to a reduction in carbon emissions — is paying for such a project. The NDA government plans to increase the proportion of gas in the country’s energy mix to 15% from the present 6.5%.