1. Infrastructure, Petroleum and Gas : Key Enabler for successor states
A.P. Gas Distribution Corporation
(A Joint Venture of APGIC and GAIL Gas Limited)
Vizag
20 September 2014

2. Objectives of the session
Opportunities for establishing infrastructure facilities
Developing petroleum and gas corridors
Infrastructure as pre-requisite for industrial growth and economic activities
PPP model: Pros & cons

3. Disclaimer
The following presentation and views are for information purpose only and are express personal opinion of the speaker. These are not endorsed by GAIL , APGDC or GoAP. Audience may independently verify before taking action and speaker does not held any responsibility for accuracy of information contained therein.

4. Presentation Outline
Successor States: Value unlocking in Oil & Gas Sector
Introduction of APGDC
Transmission & Distribution Infrastructure
Oil and Gas production infrastructure
LNG Import facilities
Refineries & Product / LPG Pipelines
Oil & Gas Infrastructure : Key enabler of growth
Key drivers and Challenges

5. Value unlocking in Oil & Gas Sector
Successor States
Specific priorities in individual states
Focussed Industrial development
Decentralization – towards inclusive growth
Deeper focus in Oil & Gas in A.P. : production, import, Distribution & export to other states
Telengana : Acts as consumption centre as well as transit corridor
Paradigm change & New Synergy with other states : New product pipeline (from Paradip), power transmission from Gujarat, Gas pipeline from Bangalore /Ennore
To Bhilwara
To Ankot (Gujarat)
EWPL (RGTIL)
MBVPL (GITL)
GAIL KG Basin Network
ENPL
Ennore
Krishnapatnam
Gangavaram
Kakinada
Legends:
GAIL KG Network:
EWPL (RGTIL) :
MVPL (under const):
P/l under bidding :
LNG Terminals planned:
Gas Fields :
Dhabol Bangaore (GAIL)
Offshore Gas fields
(RIL, ONGC, Cairn, GSPL)

6. Value Unlocking : Andhra Pradesh
Population : 4.94 crores
Coastline : 972 km , Second longest in India, next to Gujarat
Gross State Domestic Product (GSDP) : Rs. 2,35,930 Cr (US$39 billion) in
Industries : IT, Boitech, Pharma, Oil & gas, Power, Banking & Financial, Tourism, Textiles, Retail, Leather
Oil & Gas : Oil & Gas reserves (KG Basin) Refinery, Petroleum Import, pipelines, Gas Based IPPS

7. Value Unlocking : Telengana
Population : 3.52 crores
Mineral-rich state, with coal reserves at Singaerni Collieries
Gross State Domestic Product (GSDP) : Rs. 3,35,018 Cr in
Industries : IT, Boitech, Tourism
Power : Coal, Hydel based

8. Introduction of APGDC

9. APGDC – An Introduction
APGDC Limited incorporated on by APGIC
Equity Structure: APGIC :50% ; GAIL Gas : 50% with each to offload 25% to Private/Public Investors
APGIC : Joint Venture of APIIC with 51% and APGENCO with 49%
GAIL Gas : Wholly owned subsidiary of GAIL (I) Ltd.
Authorized capital is Rs. 100 Crores and paid up as on date is Rs. 20 Crores. APGIC and GAIL Gas paid Rs. 10 Crores each.
Objectives and Business Plan, as developed through KPMG:
Development of Natural Gas regional pipeline grid across the state of AP; City Gas Distribution to cover various Major cities of AP.; and creation of LNG infrastructure in the East Coast for import of Gas, etc.

10. APGDC – An Introduction
Vision
To be the leader in sourcing,
transporting and distributing
natural gas in Andhra Pradesh ,
and beyond by maximizing
value creation for all
stakeholders in an
environmentally sustainable
manner.
Objective :
To Design , Develop and construct Gas pipeline and gas distribution systems, Gas processing, Liquefaction, Re- gasification plants and to import, store, process, transport, distribute natural gas
To develop gas distribution networks in the state of Andhra Pradesh
To Source natural Gas : through import or domestic
Mission
Making Andhra Pradesh
a Natural Gas driven economy

11. MOU with Govt of A.P.
MOU signed between APGDC and GOAP during Partnership Summit, 14 Jan, 2012
To lay Dedicated natural gas pipeline from Kakinada to Vishakhapatnam
To lay regional pipeline grid
GOAP would facilitate permissions and clearances
MOU Signed between GAIL Gas / APGDC and GOAP during Partnership Summit, 14 Jan, 2012
To set up of FSRU and On land terminal through APGDC.
GOAP would facilitate permissions and clearances

12. Division of A.P. State : Value unlocking in Oil & Gas Sector
Introduction of APGDC
Transmission & Distribution Infrastructure :
Existing Pipelines
Transmission & Distribution Infrastructure
Unified AP Gas grid
Oil and Gas production infrastructure
LNG Import facilities
Refineries & LPG Pipelines
Oil & Gas Infrastructure : Key enabler of growth
Key drivers and Challenges

13. India : NG Vs Total Energy trend
Share of Natural gas in the Energy Basket : 24 %
There is marginal decline in 2013
Share of Natural Gas is in increasing trend in longer term
Data Source : B P Statistical Review 2014

14. Natural Gas Consumption
Share of Natural gas consumption as part of total primary energy : Slow but steady growth
Natural Gas consumption is sizable and significant role in longer term
Data Source : B P Statistical Review 2014

15. A.P. natural gas demand: salient features
Market Study and Business Plan completed by M/s KPMG:
Existing shortfall:13.6 MMSCMD
Additional prospective demand (in existing plants): 12.4 MMSCMD
Due to drastic reduction in domestic gas production, huge Investments made by power plants threatened to become stranded assets
Power is the first customer base in AP:
Affordability of RLNG is a key issue,
Pipeline connectivity required to mitigate the risk of power shortage.
Existing Demand (in MMSCMD)
Sector
Contracted qty.
Supply
GAP
Fertilizer
3.3
2.6
0.7
Power
14.0
2.8
12.2
CGD
0.10
0.11 -
Ceramics, Glass, Steel, and Others
0.9
0.2
Total
18.3
5.7
13.6
Future Demand (in MMSCMD)
Sector
Requirement
GAP
Fertilizer (RLNG )
5.4
Power
10.0
3.0 *
CGD
2.0
Others
Total
19.4
12.4

16. Gas Distribution Infrastructure
To Bhilwara
To Ankot (Gujarat)
EWPL (RGTIL)
MBVPL (GITL)
GAIL KG Basin Network
ENPL
Ennore
Krishnapatnam
Gangavaram
Kakinada
Legends:
GAIL KG Network:
EWPL (RGTIL) :
MVPL (under const):
P/l under bidding :
LNG Terminals planned:
Gas Fields :
Dhabol Bangaore (GAIL)
Offshore Gas fields
(RIL, ONGC, Cairn, GSPL)

17. Gas Pipelines S no. Name of the P/L From – To Capacity (MMSCMD) Status1
GAIL KG Basin Network
Kakinada- Rajahmundry – Vijayawada 15
Existing 2
East West Pipeline
(EWPL)
Kakinada – Gujarat
80-120 3
Mallavaram Bhilwara pipeline (MBVPL)
Kakinada – Bhilwara 57
Under Implementation 4
Kakinada Srikakulam pipeline and Ennore-Nellore pipeline
Kakinada to Srikakulam further to Haldia & Ennore to Nellore further to vijayawada 20 5
Ennore Nellore
Ennore - Nellore 36
Awarded 6
Vijaywada - Nellore
Viajywada – Nellore
10-15
Proposed

19. Andhra Pradesh Gas Grid
Objective : to transform economy of A.P. To gas based economy
APGDC has made demand assessment and feasibility studies across the state through M/s KPMG
Expression of interest (EOI) to PNGRB, on behalf of the GoAP , for following sections :
Kakinada Srikakulam
Ennore Nellore Pipeline
Nellore Vijaywada pipeline
APGDC has emerged as successful bidder and has been authorized by PNGRB to lay pipeline from Kakinada to Srikakulam
Nellore
Vizag
Kakinada
V’wada
R’mundry
Guntur
Ongole
Tuni
Anakapalli
V’nagaram
GAIL P/L
EWPL (RGTIL)
APGDC Authorized P/L
P/L under biding
EOI Proposed
Existing CNG locations
Proposed CNG Locations
Renigunta
DBPL
Srikakulam

20. Salient Details of KSPL
From Kakinada to Srikakulam
Total length : 301 km ( Main Line )
Sources :
Kakinada LNG
Gangavaram LNG
KG Basin ONGC/ RIL KG D-6 / Ravva fields.
Demand Centres:
KG Basin, Kakinada SEZ, MBBVPL, EWPL
Visakhapatnam, PCPIR
Vizyanagram, Bobbilee Ind. Area
Srikakulam

21. AUTHORIZATION BY PNGRB
Bid invited by PNGRB: 20th June, 2013
Letter of Intent issued : 05th June, 2014
Performance Bank Guarantee: Rs crore
Letter of Authorization Issued : 16th July, 2014
Now Open for booking of capacity by Consumers/ Customers

22. Project Implementation schedule
Critical Path :
S no.
Activity 1
Authorization by PNGRB 2
Detail Route Survey 3
ROU, Land & Permissions 4
Process Design & Proj. Engg. 5
Ordering 6
Manufacturing & Delivery 7
Contracting 8
Construction 9
Testing & Commissioning
Sep-14
Dec-14
Mar-15
Jun-15
Sep-15
Dec 15
Mar-16
Jun-16
Sep-16
Dec 16
Mar-17
Jun-17 3 6 9 12 15 18 21 24 27 30 33 36

23. Andhra Pradesh Gas Grid: An early Imperative
Nellore
Kakinada
V’wada
R’mundry
Guntur
Ongole
Tuni
Anakapalli
V’nagaram
GAIL P/L
EWPL (RGTIL)
APGDC Authorized P/L
P/L under biding
EOI Proposed
Gas Sources/ Inputs:
Renigunta
DBPL
Srikakulam
Vizag
Gas Sources/ Inputs:
Existing: KG Basin
Proposed : Kakinada, Gangavaram, Krishnapatnam, Ennore, DBPL
Gas Grid to Cover all 13 districts of A.P.
Approx. Length : km
Approx. Investment : Cr.
Karnool
Anantpur
Chitoor

24. A. P. Gas Grid S no. Sector Approx. Length (km)
Approx Investment (Rs. Cr)
Design Gas flow (MMSCMD)
Gas Transportation Tariff (Rs./ MMBTU) 1
Kakinada - Srikakulam
300
800
65-90
4.5- 6 2
Kakinada – Vijaywada
250 (existing)
Existing
10-15
5.6 3
Vijaywada – Nellore 15
7-10 4
Nellore - Ennore
730 36
8-11 5
Hindupur – Anantpur – Karnool
400
1000 10
10-12 6
Hindulpur - Renigunta
8-10

25. Infrastructure Investment & Financial viability
Investment in Order of magnitude Cost : Rs crore
Schedule :
Immediate : Kakinada – Srikakulam , Vijaywada – Nellore , Ennore – Nellore
Next 3-5 years : Anantpur – Karnool- Renigunta
Linked with Gas availability, Landed cost
Transportation Cost : Rs./ MMBTU , Nominal compared to gas cost

26. Gas Distribution : CGD and CNG
Existing CGD :
Kakinada
Rajahmundry
Vijaywada
Proposed CGD and CNGS :
Vizag
Viajayanagaram
Srikakulam
Guntur
Ongole
Nellore
Renigunta
Nellore
Vizag
Kakinada
V’wada
R’mundry
Guntur
Ongole
Tuni
Anakapalli
V’nagaram
GAIL P/L
EWPL (RGTIL)
APGDC Authorized P/L
P/L under biding
EOI Proposed
Existing CNG locations
Proposed CNG Locations
Renigunta
DBPL
Srikakulam

27. Telengana: Gas Infrastructure
2 Major Gas grids passing through the state:
EWPL(RIL) , MBVBPL (GSPL)
Ramgundam : Gas based Fertlizer
City Gas Distribution and CNG stations
Currently at Hyderabad
Notified for bidding : Nalgonda, Khamam, Medak Rangareddy
MBVBPL
EWPL
VSPL (LPG)

28. Division of A.P. State : Value unlocking in Oil & Gas Sector
Introduction of APGDC
Transmission & Distribution Infrastructure
Oil and Gas production infrastructure
LNG Import facilities
Refineries & LPG Pipelines
Oil & Gas Infrastructure : Key enabler of growth
Supports from State Govts and Central Govt.
Key drivers and Challenges

29. Proved reserve of Natural Gas: India
Production in 2013 :33.7 Billion Cu m equivalent to average of MMSCMD
Reserve to production ratio of 40.2, vs- a-vis world average of 55.1
Data Source : India Pet & NG statistics

30. Oil & Gas Production Krishna Godavari Basin in Andhra Pradesh :
Nellore
Vizag
Kakinada
V’wada
R’mundry
Guntur
Ongole
Tuni
Anakapalli
V’nagaram
Renigunta
DBPL
Srikakulam
Krishna Godavari Basin in Andhra Pradesh :
Oil and Gas Discoveries
Onshore and Offshore
Production by Private and Govt Companies
More exploration in progress
Machlipatnam
Krishnapatnam

31. KG Basin : Exploration & Discoveries
More than 225 prospects have been probed by drilling of more than 557 exploratory wells.
Hydrocarbon accumulations have been proven in 75 of these prospects
Oil : 22
Gas : 53
Source : DGH

32. Oil & Gas discovery in KG Basin
Onshore
141 prospects have been probed by 375 exploratory wells by ONGC,
11 oil & gas pools
31 gas pools have been discovered
Most of them are on production.
Offshore:
84 prospects have been probed by 182 exploratory wells .
Hydrocarbon accumulations have been proved in 33 :
11 oil & gas and 22 gas prospects
3 discovery by ONGC in the block KG-DWN- 98/2 within Plio-Pleistocene sandstone of Godavari formation and
About 19 discoveries have been made by Pvt./JV companies so far in NELP blocks
15 Dhirubhai discoveries by RIL in blocks KG- DWN-98/3 and KG-OSN-2001/2,
3 discoveries by Cairn Energy Pty. Ltd. (CEIL) in block KG-DWN-98/2 within Mio-Pliocene,
1discovery by GSPC in block KG-OSN- 2001/3 within Lower Cretaceous).

33. Division of A.P. State : Value unlocking in Oil & Gas Sector
Introduction of APGDC
Transmission & Distribution Infrastructure
Oil and Gas production infrastructure
LNG Import facilities
Refineries & LPG Pipelines
Oil & Gas Infrastructure : Key enabler of growth
Key drivers and Challenges

34. LNG Projects in East India
Kakinada
Gangavaram
Krishnapatanam
Paradip
Digha
Ennore
Karaikal
FSRU (In progress)
Land based LNG terminal
FSRU (Planned)
LNG Terminals planned in East Coast:
FSRU based :
Kakinada (2 nos.)
Krishnapatanam
Paradip
Digha
Karaikal
Land based terminal:
Gangavaram
Ennore

35. LNG Import in East Coast : Advantage
LNG Import on the East Coast
In case the LNG Import facility is located on the East Coast in AP, then the delivered price will be lower at least by 4 US Dollar due to the avoidance of additional taxes and transportation charges
Therefore, an LNG Import facility on the east coast can meet the demand shortfall economically when compared to the RLNG terminals on the West coast
Further, towards open access of terminal, power plants can make high sea purchase, where tax component becomes nil, and no customs duty, thereby making more viable
20.36
LNG un loaded on the West Coast & delivered in AP
15.68
LNG un loaded in East coast & delivered in AP

36. Kakinada FSRU : Project Layout
Break Water K D W P
Fishing
harbor
Offshore
Pipeline
Onshore
Receipt
Facility
Existing Channel
Widening of
Channel
FSRU Basin

37. FSRU : Configuration vis-à-vis Jetty ,
Island Break water
FSRU
Jetty
LNG Carrier

38. PLL LNG Terminal
land based Liquified Natural Gas (LNG) Terminal at Gangavaram Port
Petronet LNG Limited (PLL) signed a firm and binding term sheet with Gangavaram Port
Initial capacity of 5.0 MMTPA expandable to 10 MMTPA
MoEF Environmental Clearance ObtainedSchedule : 4-5 Years

39. PLL LNG Terminal
Close to Vizag Market- but no gas based Industry at present
Breakwater : does not exist for Isolated LNG berth
Availability : Dedicated LNG berth, if made outside harbour is operable only for 250 days.
Land availability : Adequate land not available. Area to be re-claimed from sea and hill cutting involved
Pipeline Connectivity : None

40. Division of A.P. State : Value unlocking in Oil & Gas Sector
Introduction of APGDC
Transmission & Distribution Infrastructure
Oil and Gas production infrastructure
LNG Import facilities
Refineries & Product / LPG Pipelines
Oil & Gas Infrastructure : Key enabler of growth
Key drivers and Challenges

41. Refineries & Product/LPG Pipelines
Vizag Refinery (HPCL)
Capacity 8.3 MMTPA
Petrol, HSD, LPG, FO, lubricants
VSPL LPG Pipeline (GAIL : 600 Km, 1.4 MTPA
VVSPL Product P/L (HPCL)
Bottling Plant, POL Terminals (OMCs) – Vizag, V’wada, S’bad
Proposed :
Refinery & Petrochem : Machlipatnam
PCPIR – Viazg - Kakinada
Existing Refinery
Planned Refinery & pet.chem
LPG/ Prduduct P/L Corridor
PCPIR
Machlipatnam

42. Division of A.P. State : Value unlocking in Oil & Gas Sector
Introduction of APGDC
Transmission & Distribution Infrastructure
Oil and Gas production infrastructure
LNG Import facilities
Refineries & LPG Pipelines
Oil & Gas Infrastructure : Key enabler of growth
Key drivers and Challenges

43. Oil & Gas Infra : Key enabler to Industries
Fertilizer
Power
Petrochemicals
City Gas Distribution
CNG & Transportation
Ceramics, Glass
Other Industries
Oil & Gas Infrastructure

44. Oil & Gas Infra : Key enabler to Industries
Should be efficient and cost effective
Available
Affordable
Environment friendly
Sustainable
To meet Govt Priorities
Oil & Gas Infrastructure : Key Characteristics

45. Division of A.P. State : Value unlocking in Oil & Gas Sector
Introduction of APGDC
Transmission & Distribution Infrastructure
Oil and Gas production infrastructure
LNG Import facilities
Refineries & LPG Pipelines
Oil & Gas Infrastructure : Key enabler of growth
Key drivers and Challenges

46. Key Drivers for Oil & Gas Infrastructure
Industry and market Demands
Moderate and sustainable Crude and LNG price regime in International Market
Private sector participation and FDI
Govt Facilitation:
Approvals
Land availability and acquisition ease
Taxation regime – Equitable to gas sector and long term growth oriented
Allocation / allotment of domestic gas to local / State Govt

47. Key Challenges Higher prevailing LNG pricing : impediment to import
Power Plants : Power tariff capped- hence gas price has to be competitive
Huge initial Capital Investment
PNGRB Bidding in gas pipelines : Assymatry , unhealthy competition

48. Thank You