GAIL to float subsidiary for city gas business

March 11th, 2008 - 5:09 pm ICT by admin  

New Delhi, March 11 (IANS) State-owned GAIL India Ltd will float a subsidiary for city gas distribution and compressed natural gas (CNG) business, its chairman and managing director U.D. Choubey said here Tuesday. “In a recent meeting, the GAIL India board has approved a proposal to this effect,” Choubey told reporters in a press conference.

“The proposed company will have a debt-to-equity ratio of 1.5:1. While GAIL plans to put initial equity of Rs.2 billion in the subsidiary company, another Rs.3 billion will come as debt,” he said.

“The subsidiary will distribute and market CNG and LPG for vehicles and supply piped natural gas for domestic, commercial and industrial uses,” he said.

“It will invest to develop supporting infrastructure like connecting gas pipelines as well as form alliances with gas producers and strategic partners for implementing city gas projects,” the GAIL chairman added.

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