Cabinet approves VGF funding for North East Gas Pipeline Grid

New Delhi: The Cabinet has decided to grant Rs 5,559 crore as VGF (Viability Gap Funding) to Indradhanush Gas Grid Limited to build the 1,656-km Gas Pipeline Grid that would be developed in the eight states of the North-Eastern region. The proposed pipeline grid project that will benefit the states of Arunachal Pradesh, Assam, Manipur, Meghalaya, Mizoram, Nagaland, Sikkim and Tripura, and has an estimated project cost of Rs 9,265 crore.

An official release said that that various government agencies would oversee the implementation of the project and iron out issues.

Govt forms committee to review progress of Gas Pipeline Grid

"For effective monitoring of the project implementation, a Committee comprising of officials from Ministry of Petroleum & Natural Gas, Department of Expenditure, Ministry of Development of North East Region, Ministry of Environment, Forest & Climate Change, and Department of Fertilizers, may be formed, which would periodically review the progress in implementation of the project and take steps to smoothen out any issues in execution," the statement said.

Gas pipeline to boost economy

The North-East region is rich in natural gas and tapping into this source will boost the industrial growth without causing any adverse impact on nature.

The Capital Grant will provide natural gas supplies to various types of consumers viz. Industrial, PNG (Domestic),  CNG (Transport) etc. and would immensely help in substituting the liquid fuels. The pipeline grid would ensure reliability and uninterrupted natural gas supplies to the consumers which otherwise gets severely affected due to various reasons in this part of the country. The project will reduce the usage of kerosene, wood etc. due to as an alternate and environment-friendly fuel would be available.

Socio-economic and environmental benefits

The pipeline is expected to boost exploration and production activities and connect regional gas sources with pipeline network for early monetisation of natural resources in the region.

Possibility of installing bottling plants for LPG can be explored for reducing transportation cost. Uninterrupted supply of LPG and other value-added products can be ensured in the region which will bring energy security to the people in the area.

Indradhanush Gas Grid Limited (IGGL) is a joint venture company of five CPSEs (IOCL, ONGC, GAIL, OIL and NRL) and was incorporated on August 10, 2018, to develop and operate the Natural gas pipeline grid in the North-East region. Petroleum & Natural Gas Regulatory Board (PNGRB) has also issued provisional authorization to IGGL on September 14, 2018, for the development of the North-East gas pipeline grid.