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7	7	GAIL (India) Ltd was incorporated in August 1984 as a Central Public Sector Undertaking (PSU) under the Ministry of Petroleum & Natural Gas (MoP&NG). The company was initially given the responsibility of construction, operation & maintenance of the Hazira - Vijaypur -Jagdishpur (HVJ) pipeline Project. It was one of the largest cross-country natural gas pipeline projects in the world. Originally this 1800 Km long pipeline was built at a cost of Rs 1700 Crores and it laid the foundation for development of market for natural Gas in India.{{footnote}}https://gailonline.com/AB-Gailstory.html{{/footnote}}
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10	10	The HVJ pipeline contract valued at Rs 722.49 crore was signed on May 10, 1986 with the consortium led by M/s Spie Capag of France and M/s NKK and Tokyo Engineering of Japan as other members to construct the HVJ Pipeline on composite basis including design, supply, handling, transportations, erection and commissioning etc. of compressor stations, terminals, cathodic protection systems and tele-communication and tele-supervisory systems.
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12	12	The pipe laying work for the Hazira – Vijaipur section was completed by middle of June, 1987 and energized by end of July 1987. The pipeline was commissioned within nine months of mobilization and 15 months from the signing of the contract.
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15	15	In November 1988, GAIL received approval for investment of Rs. 300 crore for setting up a LPG extraction plant at Vijaipur. The unit, based on HVJ gas was to have a capacity of over 400,000 TPA to be implemented in two phases of 200,000 TPA capacity each.
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17	17	By 1990-91 commissioning of the Phase I of the LPG plant at Vijaipur was completed, eight months ahead of schedule. Following this, Phase-II at Vijaipur was completed in November/December 1991 and commissioned in February 1992.
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20	20	A Joint Venture Agreement with British Gas was signed on December 6, 1994 for the Bombay City Gas Distribution Project. A company in the name and style of Mahanagar Gas Limited was incorporated and the company obtained a Certificate to commence business to implement Bombay City Gas Distribution project.
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23	23	The Government permitted GAIL to market Propane in the country during the year1993-94. During the year 1995-96, two propane recovery plants at Vijaipur were commissioned to optimize various components of natural gas.
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26	26	During the year 1997-98, the Government of India acknowledged GAIL’s ‘Excellent’ track record and potential to become a global giant, by granting the Navratna status, thereby entrusting greater autonomy to the Company.
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	23	+= Industry overview =
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29		-Industry overview
	25	+== Energy Sector ==
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	27	+As per recent global reviews, energy consumption in the world grew by around 3% in the year 2018 as compared to 2017. This has been one of the highest yearly growth since year 1990. This growth was largely driven by additional energy consumption in China, US and India which together accounted for around two-thirds of the growth. Energy consumption growth also echoed across all the primary fuels – renewable energy, gas, oil and even coal. Most of the primary fuels grew more intensely compared to their historical averages. On the other side, carbon emissions from energy use also increased sharply by around 650 million tonnes, a YoY growth rate of 2%, highest in last seven years. Most of the regions contributing to high growth in energy consumption also contributed to high growth in carbon emission while few regions like Europe showed reduction in carbon emissions compared to last year indicating their move towards cleaner fuel mix.{{footnote}}https://www.bseindia.com/bseplus/AnnualReport/532155/5321550319.pdf{{/footnote}}
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32		-Energy Sector
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34		-As per recent global reviews, energy consumption in the world grew by around 3% in the year 2018 as compared to 2017. This has been one of the highest yearly growth since year 1990. This growth was largely driven by additional energy consumption in China, US and India which together accounted for around two-thirds of the growth. Energy consumption growth also echoed across all the primary fuels – renewable energy, gas, oil and even coal. Most of the primary fuels grew more intensely compared to their historical averages. On the other side, carbon emissions from energy use also increased sharply by around 650 million tonnes, a YoY growth rate of 2%, highest in last seven years. Most of the regions contributing to high growth in energy consumption also contributed to high growth in carbon emission while few regions like Europe showed reduction in carbon emissions compared to last year indicating their move towards cleaner fuel mix.
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36		-[[https:~~/~~/www.bseindia.com/bseplus/AnnualReport/532155/5321550319.pdf>>url:https://www.bseindia.com/bseplus/AnnualReport/532155/5321550319.pdf]]
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39	39	Gas contributed to around 43% in overall energy growth in the world followed by Renewables. 2018 was a windfall year for natural gas, with both global consumption and production increasing by over 5%, one of the highest growth for both gas consumption as well as supply in last 30 years (Refer figure 2 for fuel wise share). USA became the major contributor for growth in gas, accounting for almost 40% of global demand growth and over 45% of the increase in production while gas consumption in China grew by 18% compared to last year. China’s gas demand was largely an outcome of their continued environmental policies encouraging coal-to-gas switching in both industries and buildings in order to reduce pollution in cities while continuing industrial growth.
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	31	+== LNG Industry ==
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42		-LNG Industry
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44	44	LNG trade grew over 9% in 2018 with increased supply from US and growing consumption in European and Asian markets. Further, LNG imports by China grew by approx. 40% in the year 2018. The growth in India’s gas consumption was brought almost entirely by LNG as domestic gas output remained stagnant, According to Shell LNG Outlook 2019, the number of LNG importing countries continues to increase, reaching 42 in 2018, with Panama and Bangladesh turning to LNG imports to meet their energy requirement. Also according to the same report, the average length of new LNG supply contracts doubled from around six years in 2017 to about 13 years in 2018. According to GIIGNL Annual Report 2019, total volume of over 30 Mtpa was contracted under mid-term/long-term (above 4 years of contract) LNG as compared to around 20 Mtpa in 2017. These developments indicate improved long-term health for the global LNG market.
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46	46	According to Shell LNG Outlook 2019, gas will cater to over 40% of additional energy demand i.e. the largest share of energy growth by 2035. Within gas, LNG is expected to be the fastest-growing supply source, with an expected compound annual growth rate of 4% till 2035. It is expected that growth in LNG demand will continue around the world, led by Asia and Europe. Refer Figure 3 for growth in LNG demand in Asia
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	37	+== India Energy Consumption ==
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49		-India Energy Consumption
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51	51	With a yearly growth rate of 8% in 2018 over 2017, the highest in last 11 years, India’s energy consumption growth doubled in 2018 as compared to 2017. Growth in Renewables stood highest at 27% followed by coal and gas at 8.7% and 8.1% respectively. Coal has made a strong comeback with highest ever absolute increase of over 36 MTOE .
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54	54	India’s increased consumption was accompanied by increased carbon emission as well. Carbon intensity of energy i.e. Kg CO emitted per Kg of oil equivalent energy use in 2 major energy consuming regions is shown in Figure 5. In 2014, both China and India had the similar carbon intensity of energy but with continued interventions by Govt. of China like addition of renewable capacities, coal to gas switching, electrification of transport etc. China has been quite successful in reducing carbon emissions. Although, Govt. of India is also pushing use of renewables and electrification of transport to reduce carbon emissions and urban pollution, but additional all-round efforts are also needed to encourage switching from polluting fuels like coal, petcoke, fuel oil to cleaner fuel alternatives to form a cleaner primary energy mix.
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57	57	As per Company’s analysis, Gas sector in India has significant demand potential. For instance, gas consumption in industries and refineries can touch 65MMSCMD and 80MMSCMD respectively. Power, the anchor consumer segment, which only consumed 33 MMSCMD in 2018, has a demand potential of over 100 MMSCMD without any additional investments as around 25 GW of power generation capacity already exists. Indian power sector alone has the potential to save around 120 million tonnes of CO 2 emission per year (i.e. 5% of India’s total CO emission) if opted to switch from coal to gas. Further, with addition of Renewable Energy capacities, gas based power can play a 2 major role for balancing the intermittencies in the grid.
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	45	+= Business Overview =
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60		-Business Overview
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63	63	Natural gas Marketing
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65	65	The  company holds around 59% market share in India’s gas marketing business.