GAIL plans to double share capital; add specialty chemicals, clean energy to biz
NEW DELHI: GAIL (India) Ltd wants to double its share capital as well as add specialty chemicals and clean energy to its line of business as it looks to diversify business beyond natural gas transmission and distribution.
GAIL has sought shareholder approval to increase the authorised share capital of the company to Rs 10,000 crore from the current Rs 5,000 crore to help raise finance for its expansion plans over the next 3-4 years.
The firm is laying natural gas truck pipelines to create a national gas grid as well as expand city gas distribution as part of the government's target of more than doubling the share of natural gas in the primary energy basket to 15 per cent by 2030.
"GAIL is having a capex plan of approximately Rs 30,000 crores in next 3-4 years. These projects will be funded partly through internal resources and partly through debt, which may also include the equity route," the firm said in a notice to shareholders.
Further, the company may also look at issuing bonus equity shares to its shareholders, it said.
India's largest state-owned natural gas processing and distribution company also sought to amend the Memorandum of Association (MoA) to allow entry into new business areas.
It wants to diversify into the specialty chemicals business, explore the possibility of taking equity in energy exchange and pursue acquisitions in solar glass and module manufacturing besides setting up of wind, and solar power plants, including Round The Clock power generation through storage system.
The company wants to set up ethanol manufacturing plants to produce green fuel from biomass that can be mixed with petrol.
The firm is also keen to enter the green hydrogen business as well as diversify into providing risk management services for its customers, the shareholders' notice said.
GAIL has already awarded a contract aimed at setting up one of the largest Proton Exchange Membrane (PEM) electrolyzers in the country to produce green hydrogen by the end of 2023.
It will produce around 4.3 tonnes of hydrogen per day (about 10 megawatts capacity) with a purity of about 99.99 per cent.
GAIL said the project would be installed at the company's Vijaipur Complex, in the Guna district of Madhya Pradesh, and would be operated on renewable power.
Earlier this year, GAIL kicked off the nation's first project for blending hydrogen into the natural gas system.
Hydrogen-blended natural gas is being supplied to one of the company's joint ventures - Avantika Gas Ltd (AGL) which retails CNG to automobiles and piped cooking gas to households in Indore, Madhya Pradesh.
The green push is part of the government's ambitious target for ramping up India's non-fossil fuel energy capacity to 500 gigawatts by 2030 and meeting 50 per cent of the nation's energy requirements from renewable sources.
Further, the company may also look at issuing bonus equity shares to its shareholders, it said