Gail eyes gas block held by Cairns

State-owned gas transportation company Gail India is keen on acquiring oil and gas properties of Cairn Energy Plc in India and Bangladesh.

It has also got offers from the Royal Dutch/Shell group for picking up stakes in two gas distribution companies in Egypt.

"Cairn has offered us its oil and gas block in the Krishna Godavari basin. We are also not averse to acquiring the company's other assets in India and Bangladesh," Gail India chairman and managing director Prashanto Banerjee said.

A Gail team is likely to visit Cairn's data room containing information about its oil properties later this month for due diligence.

Gail is interested in acquiring Cairn's one trillion cubic feet KG gas field and the Cambay basin block CB-OS/2 where five oil and gas discoveries have been made so far.

Banerjee said Gail was also interested in Cairn's stake in the Sangu gas field in Bangladesh. However, he did not commit if the company would make a composite bid for all the oil properties of Cairn or make separate bids.

Meanwhile, Shell has offered Gail a 19 per cent equity stake in Egypt's Fayum Gas Company and a 10 per cent shareholding in Shell CNG Company.

Gail is interested in the offers, Banerjee said. He added that company executives will visit Cairo next week to conduct a due diligence.

The Fayum Gas Company supplies piped natural gas for domestic consumption while Shell CNG retails compressed natural gas for use as automobile fuel in Cairo.

Banerjee said Gail would lend its expertise in building, operating and maintaining the infrastructure of the two projects. Gail will also help expand the existing infrastructure of the projects.

Gail India has registered a net profit of Rs 1,565 crore (Rs 15.65 billion) in 2002-03, a 32 per cent increase over the 2001-02 figure of Rs 1186 crore (Rs 11.86 billion).

Turnover increased 11 per cent to Rs 11,763 crore (Rs 117.63 billion) as compared to Rs 10,553 crore (Rs 105.53 billion) in the previous year.

Gail chairman and managing director Prashanto Banerjee said the company will invest Rs 20,000 crore (Rs 200 billion) over the next five years.