kno moree ab w t to k o yo ow m bou ut PN

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1 Do o yo ou want w t to k kno ow m moree ab bou ut PN NG for f IIndu ustries??

2 FAQs for Piped Natural Gas (PNG) supplies to Industries What is Piped Natural Gas (PNG)? PNG is a mixture of hydrocarbons normally having methane content of around 90%. Methane is the most environment friendly of all hydrocarbons because burning of Methane is normally complete thus having least carbon foot print and unburnt particulate matter emissions. PNG is a convenient fuel which is delivered through pipeline directly upto the consumption point. PNG is a versatile fuel which can be used for numerous commercial and industrial applications such as burners, furnaces, kilns, paint-shops, dryers, boilers, kitchens and food courts, power equipment, chillers and vapour absorption equipment, heaters etc. How is PNG Delivered? PNG is delivered online through a network of underground gas pipelines. Safety valves and regulators are used to control and monitor various parameters of the pipeline distribution network, to ensure uninterrupted and safe supply of PNG to the consumers. How is PNG stored in the consumer premises? PNG is delivered online and there is no storage of the fuel in the consumers premises. Who sets up the infrastructure? GAIL Gas shall take care of the following activities Laying of gas pipeline up to the consumer s premises Setting up of metering and other gas conditioning systems Operating and maintaining these systems Consumer shall take care of the following activities Laying of internal piping from the metering system to the consumption point Procurement/modification of equipment where gas will be consumed Operating and maintaining these systems How long will it take for gas to reach my premises? Minimum of six months would be required from the date of signing of agreement in areas where pipeline network exists. In other areas the timelines would depend on the distance from the nearest point where pipeline is available and the volume of gas required by the customer. Is the supply of PNG regular? 1 P age

3 Yes, the supply is absolutely regular. The pipeline distribution network is based on an online supply system that consists of safety valves and regulators that control and monitor the gas supply and pressure, and assist in identifying system leaks. Thus an un-interrupted supply at a constant pressure is assured. Is PNG safe? Flammable limit of Natural Gas (NG) is 5-15% with air whereas for LPG it is 2 to 10% with air. b) Natural Gas is lighter than air. Therefore, in case of a leak, it just rises & disperses into air given adequate ventilation. c) Auto Ignition Temperature of NG is 542 C What are the various Industrial Application of PNG? :- In the Industries PNG is being used to run Boilers, Ovens, Furnaces, Thermifluid heaters, Tumblers and Hot Water Generators for power generation, Gas engine for power Generation. The exhaust thermal energy can be used in various applications like steam boilers, Vapour absorption chillers for air conditioning, refrigeration and hot water generation. The efficiency of cogeneration plant may go as high as 93% compared to around 37% efficiency attained by only electrical power generation plant. What are the Benefits of using PNG? 1. Versatile Applications PNG can be used for a number of applications like Heating, Power Generation, Cooking, Air-conditioning etc. 2. Uninterrupted Supply GGL offers the convenience of continuous and adequate supply of PNG at all times through well laid infrastructure of pipelines. 3. Safety PNG being lighter than air is safer. 4. Environmental benefits PNG is a clean/environment friendly fuel. It does not leave any unpleasant soot, ash or odour. 5. No spillage and pilferage In case of fuels like HSD and LDO, there are considerable chances of spillage and pilferage. In case of PNG these losses are invariably done away with, as PNG is supplied through pipes. 6. No Adulteration possible which is otherwise a common problem with other liquid fuels. 7. High Combustion Efficiency 8. Billing - No up-front payment The daily bills, settlements and reconciliation are also avoided as the consumer is billed after usage 9. No Storage Required PNG does not require any storage tank or storage space since it is supplied to you through pipelines. 10. Better Inventory Management The manpower and time that was earlier being used for ensuring minimum stock levels of LPG, HSD and LDO, can be used elsewhere. 2 P age

4 11. No daily liasioning The consumer is spared the task of liasioning with oil companies and coordinating with them for ensuring the daily supply of fuel, because PNG is supplied directly through pipes. 12. No preheating required in case of PNG, no preheating is required which leads to considerable savings on auxiliary power cost 13. Lower maintenance cost with PNG, soot or ash accumulation and greasy spillages are absent from the appliances. Maintenance costs are thus, driven down. Is there any Storage Space required for Gas inside the premise? No. there isn t any storage space required; the Gas is transmitted via the Pipeline laid by GAIL Gas Limited. Do I need to obtain any approval/ license/ certificate for supply of PNG? No approval/ license/ certificate is required for supply of PNG as you are not storing any fuel in your factory premises. What is the material of the pipeline through which gas will be supplied? Carbon steel / Polyethylene (PE) pipeline depending upon the nature of requirement What is the typical composition of PNG? Generally, it consists of Methane Not less than 75% by volume, Other Gaseous Hydro Carbons Not more than 20% by volume, Non-Combustible gases other than Hydro carbons incl. Nitrogen, Carbon-Dioxide and Oxygen Not more than 20% by volume, Supher Not more than 10 parts per million (ppm) for unodorized gas plus not more than 20 ppm due to addition of odorant, no free water will be present What is the Odour of PNG? As it is a City Gas Distribution, an odour will be added to the Gas for safety. Does one had to sign an agreement for getting supply of PNG to industry? A Gas Sale Agreement (GSA) has to be signed between Customer and GAIL Gas Ltd. for supply of PNG to an Industry. What will be the tenure of the Agreement? The tenure of the agreement will be mutually decided. 3 P age

5 What is the billing cycle for supply of PNG? The invoice for a fortnight of PNG supply will be raised Within three (3) Business Days after completion of such Fortnight. The payment of each Invoice shall be due within 7 (seven) Banking Days from the date of receipt of such Invoice. Is there any security deposit has to be provided for supply of PNG? The Customer has to pay GAIL Gas Ltd. as interest free refundable Security Deposit by way of Demand Draft/ at par Bank Cheque / electronic payment towards connection cost inclusive of cost of service meter, regulator, gas meterering and regulating station and associated pipeline(s). The customer has to pay the SD in installments as provided in the GSA. Does One have to provide Security against payment? Before commencement of gas supply the customer has to provide either an interest-free deposit equivalent to the value of Gas supplied for one month s (31 days)/ actual operating days of the plant but not less than 25 days OR an unconditional, standby, automatic revolving and irrevocable letter of credit, without recourse to the drawer equivalent to value of Gas supplied for a period of three (3) Fortnights. What will be the Mode of payment for bill? Electronic transfer/rtgs/wire Transfer Is there any Minimum Guarantee quantity of gas that has to be offtake? Yes, the customer has to purchase Minimum 80% of the committed quantity Gas in a calendar year. If it fails to offtake the Minimum Guarantee quantity annually than it has to pay for it. Can I reduce my contracted quantity of gas? The customer can request up to 90% downward revision in its contracted quantity. What if there s a breakdown in the network due to govt. road repair work? :- In case of breakdown, the same has to be communicated to the Emergency Team who will address the issue promptly. This team is functional 24 x 7. There s regular patrolling done to avoid any kind of accidents due to leakages. 4 P age