GAIL to Invest in Rajasthan Power Projects

9 Aug 2024 , 08:38 AM

GAIL has signed a preliminary agreement with Rajasthan Rajya Vidyut Utpadan Nigam Limited (RRVUNL) to form a joint venture to house the latter’s gas-fired facilities and develop 1,000 MW of solar and wind power projects.

The non-binding agreement was struck with the “intent of optimising the operations of gas-based power plants in Rajasthan,” according to GAIL, the country’s largest natural gas marketer and transporter.

Power plants can be large consumers of natural gas. GAIL might discover a steady gas client by investing equity in Rajasthan’s power projects.

The two individuals “shall explore the possibility of transferring RRVUNL’s gas-based power plants located in Dholpur and Ramgarh, Rajasthan to a proposed joint venture company between GAIL & RRVUNL,” according to the firm. In addition, the two parties will collaborate to put up “1,000 MW of solar and wind projects in suitable land parcels, thus creating an opportunity for round-the-clock power,” it added.

Before launching a joint venture, the company will do extensive due diligence and feasibility studies on each proposal.

RRVUNL, a Rajasthan government firm, is responsible for the development, operation, and maintenance of power projects throughout the state.

GAIL, the nation’s largest petrol marketer, uses its extensive pipeline network to distribute fuel to a wide range of consumers in Rajasthan. It serves 19 city gas licensed regions, including Kota, Bhilwara, Bhiwadi, Chittorgarh, and Jodhpur in Rajasthan.

GAIL is the country’s largest LNG importer. Last fiscal year, it added two additional long-term LNG import contracts to its portfolio. It has to find clients to use the petrol it intends to import.

GAIL’s profit increased 93% year on year to ₹2,724 crore in the first quarter as record heat this summer increased electricity demand, causing generators to consume more gas.

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