OIL MIN TO SPLIT GAIL FOR SELLING PIPELINE VERTICAL

Mumbai: Punjab National Bank (PNB) on Tuesday reported a standalone net loss of `492.28 crore for Q3 FY20 on higher provisioning for bad loans. PNB had posted a net profit of `246 crore for the same period a year ago. In Q3, the bank had reported a profit of `507 crore. The total income was at `15,967 crore as against `14,854 crore in the year-ago period.

New Delhi, Feb. 4: The oil ministry has moved a Cabinet note seeking approval for hiving off state-owned gas utility GAIL (India) Ltd’s pipeline business into a separate entity for a possible sale to a strategic investor at a later date, sources privy to the development said.

GAIL is India’s biggest natural gas marketing and trading firm and owns more than 70 per cent of the country’s

16,981-km pipeline network, giving it a stranglehold on the market.

Users of natural gas have often complained about not ‘fairly’ getting access to GAIL’s 12,160km pipeline network to transport their fuel.

Sources said to resolve the conflict arising out of the same entity owning the two jobs, bifurcating GAIL is being considered.

GAIL’s core business after the bifurcation would be the marketing of natural gas and petrochemical production. It will have to hire capacity on pipelines from the subsidiary and pay regulator approved traffics for the same.

It will continue to execute the gas sales agreements it has already signed and will be responsible for the discharge of the obligation under purchase pacts including for import of LNG.

The ministry in December floated a note for consideration of the Union Cabinet for transferring the pipeline business into a 100 per cent subsidiary.

The Cabinet, they said, is likely to consider the proposal shortly.

Sources said the pipeline subsidiary may be sold off to a strategic investor but the sale is not likely before 2022 as the government thinks that the gas market in the country will not be mature before that time.