Singapore based company to make Rs. 2000 CR FDI in Punjab to set up Natural Gas Distribution Infrastructure.

Facts :

• Responding to the positive investment climate being aggressively promoted in Punjab under the leadership of Chief Minister, Captain Amarinder Singh, Singapore-based Think Gas Investments PTE Limited (Think Gas) has decided to establish natural gas distribution infrastructure in the state.
• ‘Think Gas’, a Gas Infrastructure Development and Marketing Company, has taken the responsibility of erecting Piped Natural Gas (PNG) for cooking and domestic use, Compressed Natural Gas (CNG) for auto rickshaws, cars, taxis, buses, and other commercial vehicles and Natural Gas (NG) for industries and commercial establishments, in the state.
• As per the Centre Government’s initiative to significantly increase the share of natural gas in the nation’s energy mix, the company will lay a network of pipelines across the six districts in Punjab to connect households and commercial establishments to PNG and installing a network of CNG retail outlets.
• In-addition, as per the objective of the government, green fuel (CNG) stations will be set up by the company in the districts.
• After the launch of project, the company will start working on it, so that CNG could be used in place of petrol and diesel to run vehicles.
• The company will set up retail outlets at key locations so that customers can access the fuel with ease across the districts. The benefit of CNG fuel is that there will be easy to convert duel fuel system, where standard conversion kits can be used to convert existing vehicles so that they can run on CNG as well as diesel or petrol.
• The expected foreign direct investment (FDI) for this project is approximately Rs 2000 crore and employment generation potential of more than 1500 jobs.
• The proposed infrastructure will be spread across an area of 12,000 sq. km, covering the districts of Ludhiana, Barnala, Moga, Jalandhar, Kapurthala and SBS Nagar.
• The company aims to transform the energy consumption patterns in the state by penetrating approximately 45% of Punjab’s households, in both urban and rural areas, along with its industrial sector.
• Think Gas CEO Hardeep Singh Rai met the Chief Minister to discuss the company’s plans for the next 3-4 years.
• The company will start the first phase of their ground operations soon. The Additional Chief Secretary Investment Promotion Vini Mahajan and CEO Invest Punjab Rajat Agarwal were present during the discussions regarding the execution of the project.
• The Chief Minister extended to the company all support from his government for timely implementation of the project, and directed Invest Punjab to facilitate all required approvals from concerned authorities for them.

Analysis :

• The Chief Minister said the project will mark the beginning of a new era of clean fuel infrastructure availability in the state, and will encourage industries and citizens to transit to using cleaner fuel options.
• This will result in lesser environment pollution.
• The widespread network of piped natural gas will reduce the cost of production for industries in Punjab.
• Overall, it will also improve the quality of life of citizens of the state.
• The natural gas is a significantly cleaner and economical alternative to the fuels that were currently being used in the districts for cooking, heating, transportation and industrial production.
• It’s a pollution-free, economical and safer fuel that can be used uninterruptedly at any time.
• Being lighter than air, it floats away in case of leakage, minimising the risk of fire and disasters. It requires no storage as opposed to LPG cylinders.
• Besides the installation charges, the cost of gas is determined by its quantity being consumed.
• The Government of Punjab has taken multiple initiatives which have infused confidence and positivity in the business and industrial environment in the state.
• The manufacturing and services sectors today contribute about 74% to the state economy. Consequently, this has increased urbanisation and industrialisation in Punjab, driving the demand for clean fuel energy.
   

THINK GAS Pvt. Ltd. :

• THINK Gas is a recently formed Indian company on 27 April 2018 backed by I Squared Capital, a leading global infrastructure fund headquartered in Singapore.
• It is classified as Non-govt company and is registered at Registrar of Companies, Delhi. Its authorized share capital is Rs. 1,000,000 and its paid up capital is Rs. 100,000.
• It is inolved in Extraction of crude petroleum and natural gas [including liquefaction/ regasification of natural gas for purposes of transport and the production, at the mining site, of hydrocarbons from oil or gas field gases.
• It is ISQ’s Gas platform entity for India and the fund is providing significant equity line to THINK Gas.
• The company intends to build an independent, pure-play, city gas distribution company that will gather and develop a portfolio of CGD assets through (i) bidding for new licenses in future bidding rounds; and (ii) acquisition of existing CGD licenses from 3rd parties.
• In the recent round of bidding that closed in July, THINK Gas has been awarded 4 CGD licenses and will now begin the development of those assets.
• The company is headquartered in New Delhi (India). Locations of 4 soon to start projects are Ludhiana, Jalandhar, Bhopal & Begusarai.