Pradyut Bordoloi inaugurates the Duliajan-Numaligarh Pipeline Project on Monday. Picture by UB Photos

Duliajan, Feb. 28: The Duliajan-Numaligarh Pipeline Project, an advance natural gas transportation system that is expected to ensure substantial economic benefit for Assam’s oil sector, was inaugurated by industry minister Pradyut Bordoloi today.

The project was executed by DNP Limited, a joint venture company that incorporated under Companies Act on June 15, 2007, after Dispur decided to create a gas grid of its own.

Accordingly, Assam Gas Company Limited (AGCL), Numaligarh Refinery Limited (NRL) and Oil India Limited (OIL) joined hands to form the company — with 51 per cent equity for AGCL, 26 per cent for NRL and 23 per cent for OIL.

The total cost of the project is Rs 380 crore, of which the Oil India Development Board sanctioned a Rs 81-crore loan on minimum interest to the AGCL.

The pipeline, approximately 193km long and 16-inch in diameter, will help OIL sell 1 million standard cubic metre per day of natural gas to NRL, substituting naptha, which is expensive.

This will bring substantial benefit to NRL, which will supply the saved naptha to the gas cracker project at Lepetkata in Dibrugarh as feedstock.

On the other hand, OIL will be earn revenue for selling the gas to NRL.

The joint venture company will earn transportation tariff, while the state government will earn tax for the sale of gas.

“We do not want the project to stop here. In fact, we will be happy to see the 193km pipeline act as a major infrastructure for future gas transportation to various consumption centres in Guwahati and even beyond,” the minister said.

Principal secretary (industries and commerce) and chairman of the company Ravi Kapoor said the state government would have to adopt a zero-tolerance policy towards disruption of any activity related to production of oil and gas.

Bordoloi later said in a bid to bring in more professionalism in the state’s industrial sector, the Assam government has decided to adopt a grading system for the state’s public sector undertakings (PSU) based on their performance and growth potential.