Bihar and Jharkhand together account for the largest chunk of 10 projects that have tied up funds for building PNG (piped natural gas) and CNG (compressed natural gas) networks in cities within their licence areas
Lenders are betting big on the government’s drive to push clean fuel, with more than a third of the CGD (city gas distribution) network projects involving investments of nearly Rs 38,000 crore have achieved financial closure within months after the licences were auctioned, latest oil ministry data shows.
The projects that have tie up funds cover 58 GAs, or geographical areas akin to licence areas spanning districts/states, across 17 states. Bihar and Jharkhand together account for the largest chunk of 10 projects that have tied up funds for building PNG (piped natural gas) and CNG (compressed natural gas) networks in cities within their licence areas. Madhya Pradesh and Odisha follow with seven and six projects, respectively, achieving financial closure.
At a time when securing project funding is an issue for large projects, the success of these CGD licensees in tying up funds quickly indicates lender confidence in city gas projects being pushed by the Narendra Modi government as part of its push for turning India into a gas-driven economy over the next 4 years.
Only 34 GAs in the country had city gas networks till 2014, when Modi became PM. Since then, his government has given out CGD licences for 174 GAS that will cover 70% of the population and 53% of the country’s geographical area spanning 400 districts across 27 states. The programme is estimated to require estimated investment of Rs 90,000 crore
The push for natural gas has seen the number of households with PNG connections rising to 55 lakh and CNG stations to 1,838, marking a growth of 14-15% in the last five years.