Petronet needs strategic partner at Gangavaram, says MD

Q: So if GAIL also were to toe the line as you said of the other 3 equity holders, then are you in talks with anyone else? Would it be one of the Qatar gas suppliers in which case they would have a strategic interest and that would be beneficial to you as well? So should we expect one of your gas suppliers to pick up that 5-5.2% stake?

A: As a process we have hardly any role to play. It is ADB's stake and they are going to sell it to a prospective buyer. We have to only later take it on once this comes to our board for information or ratification. Essentially, it is the four promoters and the ADB that have to go ahead with the process.

I am sure the understanding from all promoters and ADB is that whosoever buys should actually strategically add value to the company's working and maintain the present structure of the company. They are working on that and I only know that there have been many companies, financial institutions, major funds who had shown interest. But, I am not aware of any shortlisted buyer or with whom ADB has actually moved ahead.

Q: You can't give your investors the confidence that perhaps one of the gas suppliers will be picking up the stake, the likelihood doesn't look very high for you or does it?

A: It is very likely to have any major LNG producer, major ENP company, major fund which deals with oil and gas sector. Anyone of them would add value and as you know, all the promoters have had this point of view that we would be comfortable with any strategic partner who adds value. I am sure they will take care of the overall working and the long term perspective of the company's functioning.

Q: Can you give us an idea of what will be the utilization at Kochi in the current year or in the next twelve months?

A: Kochi most likely would be commissioned around New Year. We are trying to finalise the dates with the completion of the pipeline network, connectivity with us, connectivity with the actual consumers and preparedness of the actual consumers to receive gas. I think all this is being worked out by the teams tactically. We expect this to happen somewhere in the New Year.

But, the first phase of the pipeline would be ready, connecting four-five consumers near about 45 kilometers of pipeline. We should be able to supply, but the utilization would be of the order of about 0.6-0.7 million tonne an annum, slowly rising as more consumers come in.

It will be around 1 million tonne per annum. But, the major thrust would come when the second phase of the pipeline connecting Kochi to Mangalore and Kochi to Bangalore via Tamil Nadu would be commissioned sometime next year. I think there would be a quantum jump on the utilization.

Q: So from calendar 2013, we should assume 6.7 million tonne, is it?

A: At Kochi, we feel it should be around 75% to 80% of its capacity utilization when the phase II is completed next year end.