Dilip Buildcon (DBL) has received a Letter of Intent (LoI) from the Petroleum and Natural Gas Regulatory Board (PNGRB) for the grant of authorisation to lay, build, operate or expand a petroleum and petroleum product (LPG) pipeline from Paradip in Odisha to Raipur in Chhattisgarh.
Under the project, DBL, through a wholly owned Special Purpose Vehicle (SPV), will undertake the design, financing, development, construction, operation and maintenance of the proposed LPG pipeline infrastructure, subject to applicable approvals and regulatory requirements.
The pipeline will transport LPG to the bottling plants of various oil marketing companies (OMCs), with the objective of replacing a portion of the existing road-based transportation of LPG through tankers. The project is expected to improve the efficiency of LPG transportation and enhance road safety.
The proposed pipeline will also operate as a common carrier under the applicable PNGRB framework, allowing eligible OMCs and other users to access its capacity. Revenue will be generated through the applicable pipeline transportation tariff.
The project will be implemented under an SPV in which DBL will hold 100 percent equity. The EPC works are proposed to be awarded to DBL, representing a business opportunity of approximately Rs 1,800 crore, excluding GST.
The EPC component is scheduled to be executed over a period of 36 months, while the authorised entity will operate the pipeline for 25 years following completion of the construction period.
DBL’s role will be limited to development and operation of the LPG pipeline infrastructure and provision of transportation services. The company will not be involved in the procurement, trading, distribution or sale of LPG, and will not bear the associated commercial risks related to LPG procurement and marketing.
