New Delhi: After Delhi, Compressed Natural Gas (CNG) supplies to automobiles and piped cooking gas for households will commence in Jalandhar in the next 18 months.
Jalandhar will be the first city in Punjab to get CNG, an environment friendly fuel that is considered cheaper than diesel.
"We will start operations in 12-18 months," said an official of Jay Madhok Energy Pvt Ltd, which has won the licence to sell CNG to automobiles and piped cooking gas in Jalandhar.
City-based Jay Madhok Energy had outbid state-owned GAIL Gas, Oil and Natural Gas Corp (ONGC), Hindustan Petroleum (HPCL), Indian Oil-Adani combine and Bharat Petroleum (BPCL) to win city gas distribution rights in Jalandhar.
"We have tied up gas supplies and will be rolling out the network in phases," he said.
In all, 26 companies submitted 51 bids for the seven cities offered by Petroleum and Natural Gas Regulatory Board (PNGRB) in the third round of auction of city gas distribution licences in July 2010 -- Asansol-Durgapur in West Bengal, Bhavnagar, Kutch-East, Kutch-West and Jamnagar in Gujarat, and Ludhiana and Jalandhar in Punjab.
Jalandhar attracted the second-highest bids, with 12 firms in the fray, including Hindustan Petroleum (HPCL), GAIL Gas, Indraprastha Gas, Indian Oil-Adani Gas, GSPC Gas, BPCL-ONGC-OIL, Lanco Infratech, HCC Infrastructure and Jay Madhok Energy.
PNGRB opened price bids last month and awarded rights for Jalandhar to Jay Madhok.
Jay Madhok Energy is also considered a front-runner to win Kutch-East and Ludhiana, the city that received the most bids, with offers from 16 companies. Licences for these and other cities are yet to be decided by the regulator.
PNGRB, in its September 6 order for authorising Jay Madhok Energy for city gas distribution in Jalandhar, said the company has to start laying the gas distribution network "within a period of 180 days from the date of this authorisation".
The network will cover an area of 338 square kilometres in Jalandhar, with sales estimated to reach 2.5 million standard cubic meters per day in five years, the official said.
The firm will add 46,800 piped cooking gas customers every year in the first four years of operations.
The PNGRB has planned a phased roll-out of the city gas distribution network, covering more than 300 cities and towns across various states. Delhi and Mumbai are among the select cities in the country that have successful city gas distribution projects.