1 ENERGY EFFICIENCY IMPROVEMENT IN GAS HANDLING & PROCESSING (5 th JUNE 2008) DELHI M M MANDAL GAIL (INDIA) LTD.

2 PRESNTATION OUTLINE ENERGY SCENARIO – AN OVERVIEW ENERGY SCENARIO – AN OVERVIEW BARRIERS TO ENERGY CONSERVATION BARRIERS TO ENERGY CONSERVATION BENEFITS OF CONSERVATION BENEFITS OF CONSERVATION GAIL’s APPROACH TO ENERGY EFFICIENCY GAIL’s APPROACH TO ENERGY EFFICIENCY SUGGESTIONS SUGGESTIONS

3 INDIAN ECONOMY: SNAPSHOTS INDIAN ECONOMY IS:INDIAN ECONOMY IS: -12 TH LARGEST IN THE WORLD WITH A GDP OF US $ 1.25 TRILLION (CHINA-3.25 TRILLION & USA TRILLION) -3 RD LARGEST ECONOMY IN THE WORLD, IN TERMS OF PURCHASING POWER. (SOURCE: CIA WEBSITE) ACHIEVED A GDP GROWTH RATE OF 9.4% IN viz-a-viz CHINA-10.7 %, BRAZIL-3.7% & RUSSIA-6.7%.ACHIEVED A GDP GROWTH RATE OF 9.4% IN viz-a-viz CHINA-10.7 %, BRAZIL-3.7% & RUSSIA-6.7%. TARGET FOR NEXT 20 YEARS – 10 %.TARGET FOR NEXT 20 YEARS – 10 %.

4 ENERGY SCENARIO (INDIA Vs OTHERS) ● 15% OF WORLD’S POPULATION- 3% OF GLOBAL ENERGY USAGE. ● PER CAPITA CONSUMPTION OF ENERGY (TOE/CAPITA): -INDIA: CHINA: BRAZIL: USA: WORLD AVERAGE: 1.77 (Source: Key world Energy Statistic IEA) ● FLOURISHING ECONOMY – HIGH ENERGY REQUIREMENT TO SUSTAIN GROWTH.

5 ENERGY SCENARIO: PRIMARY ENERGY CONSUMPTION PATTERN WorldIndia Energy Consumption (MTOE) 10, th Largest Energy Consumer Energy Mix (%) Coal28.4%56.2% Oil35.8%28.4% Natural gas 23.7%8.5% Nuclear5.8%0.9% Hydro6.3%6.0% Oil & Gas Imports (MTOE) , Growth in Energy (10 yrs) Total Primary Energy 2.3%5.6% Natural Gas 2.7%9.4% Source : BP Statistical Review of World Energy June 2007

6 BARRIERS TO ENERGY CONSERVATION EFFORTS ● NEW PROJECTS GET PRIORITY ● ANNUAL BENEFITS ON ENERGY CONSERVATION LOOKS SMALL AND HENCE USUALLY GET LESS ATTENTION. ● LACK OF FOCUS / ADEQUATE KNOWLEDGE TO IDENTIFY POTENTIAL AREAS FOR ENERGY OPTIMIZATION. ● IN-ADEQUATE R&D INVESTMENTS. ● IN-ADEQUATE INDUSTRY AWARENESS OF NEW TECHNOLOGY.

7 CONSERVATIONIN GAS SECTOR

8 OVERALL DEMAND SUPPLY BALANCE Projected Domestic Supply LNG Supply Total Supply Total Demand Demand Supply Gap (-) (-) 5.02 (-) 5.99 Source: Sub-Group of Natural Gas, MoP&NG MMSCMD

9 ENERGY CONSERVATION GAIL’s APPROACH ● IDENTIFICATION OF AREAS OF IMPROVEMENT AND THEIR SOLUTION THROUGH -QUALITY CIRCLE AT SHOP FLOOR -STATISTICAL PROCESS CONTROL(SIX SIGMA) -5S -KAIZAN -RE-ENGINEERING & EVALUATION ● IDENTIFICATION OF ENERGY EFFICIENT TECHNOLOGY / EQUIPMENT. ● TRAINING AND AWARENESS TO ALL EMPLOYEES THROUGH SEMINARS / WORK SHOPS / QUIZES AT PERIODIC INTERVALS. ● PERIODIC ENERGY AUDITS AT ALL WORK CENTERS. ● IMPLEMENTATION OF EMPLOYEES SUGGESTION SCHEMES. ● SYSTEM OF MoU INCLUDING ENERGY PARAMETERS BETWEEN VARIOUS REGIONAL CENTRES & CORPORATE MANAGEMENT.

10 ENERGY CONSERVATION - MEASURES TAKEN ● QUICK HIT PROJECTS - BENCH MARKING OF VARIOUS PROCESS UNITS WITH WORLD BEST. - AWARENESS CAMPAIGN TO SAVE ENERGY THROUGH OPTIMAL UTILIZATION / RUNNING OF STATIC AND ROTATING EQUIPMENTS. - MAINTAINING P.F. IN THE RANGE OF 0.95 TO 1.0 THROUGH INSTALLATION OF ADDITIONAL P.F. IMPROVEMENT EQUIPMENTS RESULTED IN ANNUAL SAVINGS OF RS LACS. - MODIFICATION IN LIGHTING SYSTEM RESULTED IN OVER 8 LACS KW HRS OF ENERGY SAVING WITH COST SAVINGS OF RS 40 LACS. - REDUCTION IN NITROGEN CONSUMPTION IN PROCESSING PLANT RESULTED IN COST SAVINGS OF RS 1.27 CRS PER ANNUM. - SAVINGS IN FUEL GAS CONSUMPTION THROUGH SWITCHING OVER FROM FUEL GAS TO NITROGEN FOR FLARE END PURGING RESULTED IN FUEL SAVINGS OF RS CRS PER ANNUM.

11 ● VARIABLE FREQUENCY DRIVE(VFD) SYSTEM IMPLEMENTED FOR SOME PUMPS e.g. JOCKEY PUMPS (LPG-GANDHAR), REACTOR FEED PUMP (LLDPE UNIT). ● REINFORCEMENT OF METTALIC EXPANSION BELLOWS OF HRSG WITH FABRIC EXPANSION BELLOWS FOR ARRESTING LEAKAGES RESULTING IN REDUCTION IN FUEL GAS CONSUMPTION TO THE TUNE OF 4.8 CRS PER ANNUM. ● REPLACEMENT OF THYRISTOR BASED UPS WITH ENERGY EFFICIENT UPS SYSTEM RESULTING IN ANNUAL COST SAVINGS OF RS 28 LACS. ● STATE OF THE ART TECHNOLOGY FOR MONITORING & CONTROL OF P/L OPERATION THROUGH SCADA. ● RR 15 (JAGOTI), BECOMES THE FIRST “GREEN RR” WITH ALL LOADS ON SOLAR POWER IN HVJ ENERGY CONSERVATION MEASURES TAKEN (Contd…)

12 ENERGY EFFICIENCY – MEASURES TAKEN BENEFITS OF SCADA REAL TIME MONITORING AND CONTROL FROM A CENTRAL LOCATION. REAL TIME MONITORING AND CONTROL FROM A CENTRAL LOCATION. ● LEAK DETECTION. ● PREDICTIVE LOOK AHEAD MODEL FOR OPERATION. ● PREDICTIVE MAINT. REQUIREMENTS FOR COMPRS.

13 ENERGY EFFICIENCY –MEASURES PLANNED ● ENERGY SAVING IN HVJ COMPRESSOR STATIONS AT JHABUA & KHERA - MODIFICATION FOR SWAPPING OF APM + PMT RICH GAS &LNG BETWEEN DVPL & HVJ SYSTEM RESULTING IN STOPPING OF COMPRESSORS AT JHABUA & KHERA. ADVANCED PROCESS CONTROL SYSTEM(APC) IS UNDER IMPLEMENTATION FOR UPSTREAM UNITS (GPU/LPG/GCU) AT PATA PETROCHEMICAL PROJECT. EXPECTED REDUCTION IN SP. ENERGY CONSUMPTION TO THE TUNE OF 3%. ADVANCED PROCESS CONTROL SYSTEM(APC) IS UNDER IMPLEMENTATION FOR UPSTREAM UNITS (GPU/LPG/GCU) AT PATA PETROCHEMICAL PROJECT. EXPECTED REDUCTION IN SP. ENERGY CONSUMPTION TO THE TUNE OF 3%. ● ETHYLENE BOIL OFF GAS & SPHERE VAPOURS DIVERSION TO HDPE UNIT - REDUCING RECYCLING IN GCU. EXPECTED BENEFIT OF RS. 10 CRS PER ANNUM ● 32 SVs CONVERTED TO GRID POWER FROM TEG IN JLPL RESULTING IN SAVING OF 232 MT OF LPG IN

14 ENERGY EFFICIENCY –MEASURES PLANNED (Contd….) ● SOLAR POWER SYSTEM AT GANDHAR AT AN APPROX. COST OF RS 9.3 LAKHS WHICH WOULD RESULT IN ANNUAL ENERGY KWH AND ANNUAL COST SAVING OF RS 2.43 LAKHS. INSTALLATION OF VARIABLE SPEED DRIVE IN DVPL COMPRESSOR STATION, VIJAIPUR. EXPECTED SAVINGS OF RS 7.84 LAC / ANNUM. INSTALLATION OF VARIABLE SPEED DRIVE IN DVPL COMPRESSOR STATION, VIJAIPUR. EXPECTED SAVINGS OF RS 7.84 LAC / ANNUM. ● WIND ENERGY PROJECTS IN THE STATE OF MAHARASHTRA, RAJASTHAN & GUJARAT. ● WASTE HEAT RECOVERY PROJECTS (GT’s EXHAUST) FOR STEAM / POWER GENERATION AT VAGHODIA / HAZIRA / JHABUA / KHERA COMPRESSOR STATIONS.

15 ● USE OF REACTOR EFFLUENT HEAT TO PRE-HEAT DE- BUTANISER COLUMN FEED, EXPECTED BENEFIT OF RS LACS PER ANNUM. ● DIVERSION OF 0.5 MMSCMD GAS IN BHARUCH REGION FOR PROCESSING AT GPU-GANDHAR. ● REPLACEMENT OF V-BELT WITH POLY V-BELT IN INST. AIR COMPRESSOR IN LPG-USAR FOR ENERGY SAVING. ENERGY EFFICIENCY –MEASURES PLANNED (Contd….)

16 ENERGY EFFICIENCY IMPROVEMENTS – SOME SUGGESTIONS ● BENCHMARKING OF ENERGY CONSUMPTION -INTERNALLY THROUGH HISTORICAL / TREND ANALYSIS. -EXTERNALLY ACROSS SIMILAR INDUSTRIES. -IDENTIFICATION OF BEST PRACTICES (BASED ON EXTERNAL BENCHMARKING DATA). ● PERIODIC ENERGY MONITORING AND TARGET SETTING. ● MATCHING SYSTEM / EQUIPMENT SIZING OR RATING WITH ACTUAL PROCESS REQUIREMENTS. ● USE OF SP. ENERGY PARAMETERS FOR ASSESSING PERFORMANCE. ● JUDICIOUS LOADING ON ENERGY REQUIREMENTS FOR EVALUATION OF BIDS.

17 ENERGY EFFICIENCY IMPROVEMENTS SOME SUGGESTIONS (Contd…) ● LUCRATIVE DIRECT INCENTIVES TO INDIVIDUAL EMPLOYEES THROUGH SUGGESTION SCHEMES INDUCES MANY FOR OUT OF BOX THINKING. ● SUBSTITUTING EXISTING FOSSILS FUEL WITH MORE EFFICIENT & LESS COST / LESS POLLUTING FUELS. ● CREATION BY STATE BODIES OF AN APPROPRIATE SET OF INCENTIVES THROUGH PRICING & OTHER POLICY MEASURES FOR PROMOTING ENERGY EFFICIENCY & CONSERVATION.

18 THANK YOU

19 GAIL’s ENERGY CONSUMPTION (LIQUID HYDROCARBON) S. NO UNITCAPACITY(MMSCMD) LHC PROD. (000’ MT) FUEL GAS CONSUMPTION (% OF O/P ENERGY) BENCH MARK ACTUAL LPG VIJAIPUR LPG GANDHAR LPG USAR LPG VAGHODIA LPG PATA LPG LAKWA DUE TO INCONSISTENT SUPPLY OF FEED GAS FROM ONGC, FUEL CONSUMPTION IS HIGH FOR LPG – LAKWA & USAR

20 S. NO PRODUCT PRODUCTION CAPACITY (KTA) SP. ENERGY CONSUMPTION (KWH/MT) GLOBAL INTERNAL TARGET ACTUAL ETHYLENE LLDPE HDPE GAIL’s ENERGY CONSUMPTION (PETROCHEMICALS)

21 GAIL’s ENERGY CONSUMPTION (PIPELINES) S. NO PIPELINE AVG. FLOW RATE ENERGY CONSUMPTION (KJ/MT/KM) INTERNAL TARGET ACTUAL JAMNAGAR-LONI LPG P/L 168 MT/HR VIZAG – SECUNDERABAD LPG P/L 100 MT/HR A.NATURAL GAS PIPELINES AVG. FLOW RATE (MMSCMD) FUEL GAS CONSUMPTION (% OF GAS DELIVERED IN ENERGY TERMS) BENCHMARKACTUAL B.LPG PIPELINES