The General Board of Vadodara Municipal Corporation (VMC) today approved a proposal seeking to form a joint venture company (JVC) with GAIL to provide piped natural gas to more than 98,000 more households in the city.
After a discussion,councillors of the ruling BJP and opposition Congress cleared the proposal at a special meeting of the Board convened on Wednesday afternoon.
According to the proposal,the JVC would be known as Vadodara Gas Company Limited. Its board of directors would have six members,three each from VMC and Gas Authority of Indian Limited (GAIL). Officials of GAIL and VMC would serve as chairman of the new company in turns for tenures of two years each.
After the JVC becomes operational,5,000 to 10,000 new connections for piped gas will be given every year. In the next five to 10 years,more than 98,000 new gas connections will be given, Vijay Shah,chairman of standing committee of VMC,said while presenting the proposal at the meeting.
Presently,the gas department of the civic body supplies piped cooking gas to 75,000 households and 2,800 commercial users. It does not give new commercial connections to maintain supply to domestic users. However,once the JVC comes into existence,there will be no such restriction. The company has plans to supply gas to industrial sector as well, Shah said.
The new company will spend Rs 250 crore to lay a network of high-density pipeline of steel which will have the capacity to supply 22 kg of gas (per second) to domestic users. This will solve problem of low-pressure gas supply during winter, the chairman said. The existing 650 km-long pipeline network of VMC can sustain only 1.8 kg gas per second.
VMC and GAIL had signed a memorandum of understanding (MoU) for the JVC in October 2009. Both VMC and GAIL will hold 50 per cent stake each in the new company. After the approval of the General Board,the JVC will require sanction from state government.
The JVC is likely to be operational in two months.