Mukesh Ambani led Reliance Industries Limited (RIL) is one of the country’s leading private conglomerates. It recently made a massive foray into the digital sector with the launch of its telecom arm, Reliance Jio. Jio, within a short span of its launch, made it to the top ranks, with its affordable and superior 4G services. Although RIL has been garnering widespread popularity for this telecom project, the company has also been developing its presence in the oil segment. RIL has been a long-standing player in the oil industry, contributing largely to India’s growth in the sector.
Access to LPG Pipeline
Recently, Reliance Industries Limited requested access to an LPG pipeline, the longest of its kind in the country. The pipeline, being laid out by Indian Oil Corporation (IOC) is expected to be positioned between Gorakhpur (eastern Uttar Pradesh) and Gujarat. The project has been aimed at making cooking gas, one of the most important commodities, which have an exponentially growing demand among the Indian population, easily available.
India’s longest LPG pipeline
Currently, the Indian Oil Corp is on the way to execute its plan of importing Liquefied Petroleum Gas (LPG) from the start point that is Kandla, located in Gujarat, through a pipeline to various places. The pipeline, which measures 1,987 kilometers, covers areas like Ujjain, Kanpur, Bhopal, Ahmedabad, Allahabad, Lucknow, and Varanasi, before reaching Gorakhpur.
RIL’s plans to offer LPG to rural areas
Concerning the IOC proposal on the LPG pipeline, RIL stated its interest in reaching out to the specified areas mentioned in the project, with a keen interest in capacity access with regard to the same. RIL aims to transport its Jamnagar refinery-produced LPG though the pipeline. IOC also mentioned that the Indian Government intends to expand its LPG coverage to rural areas, mainly because of its health, safety and environment (HSE) initiatives. IOC added that RIL has been actively involved in providing LPG to rural areas and through its involvement in IOC’s pipeline project, the company aims to further expand its reach in the rural sector.
In addition to seeking permission to transport its own LPG, RIL also intends to receive third party access to IOC’s storage units. The units will be designed along the path of the pipeline and will serve the purpose of containing the gas before sending it to plants, where the gas will be filled into cylinders for sale. RIL stated that access to the same is crucial for the company to fully penetrate areas in rural India. In the letter to PNGRB, RIL requested that the pipelines and concerned facilities should be declared as ‘common carrier’. The company added that when required, IOC could even arrange for facilities for bulk truck loading.
Mukesh Ambani led RIL, which has a refining capacity amounting to 62 million tons stated that the aggregation of demand could prevent unprofitable investment with respect to the pipeline project, thereby reducing the transportation costs. The ambitious project will become the largest LPG pipeline in India.
Summary
Reliance Industries Limited intends to gain access to IOC’s LPG pipeline.