Philippines, Manila
The Asian Development Bank (ADB) has invested in a joint venture
company that will introduce clean fuels for vehicles and piped natural
gas for domestic, industrial, and commercial users in the city of
Kanpur, state of Uttar Pradesh, in India.
The Rs120.0 million ($2.7 million) investment is for a 20.0% stake
in Central Uttar Pradesh Gas Limited (CUGL). The shareholders agreement
was signed on 30 November 2006 in New Delhi, India, establishing the
company alongside GAIL (India) Limited, Bharat Petroleum Company
Limited and other Indian financial investors.
CUGL is currently constructing compressed natural gas (CNG) filling
stations in Kanpur and other nearby towns to service cars, buses,
taxis, and two- and three-wheelers that have been converted to use the
gas and also a piped city gas distribution network. At present, 3 CNG
filling stations have already been commissioned, and CUGL is selling an
average of 13,680 kilograms of CNG per day to converted vehicles.
“Following the successful implementation of similar projects in Delhi
and Mumbai, this project is designed to reduce air pollution and
improve ambient air quality by switching vehicles to CNG and industrial
users to piped natural gas in key industrial towns such as Kanpur,”
said Don Purka, Investment Specialist with the ADB’s Private Sector
Operations Department. “In addition to the environmental and health
benefits, natural gas is more economically viable and stable fuel
source for users.”
The equity investment by ADB will enhance economic growth by further
developing key urban energy infrastructure networks while ensuring
environmental sustainability. Providing natural gas to small-scale
industries at a lower cost than alternative fuels could create jobs by
increasing production or attracting energy-intensive industries to the
area.
The project is also expected to reduce health risks caused by using
inferior fuels and decrease both indoor and outdoor air pollution.
“Low-income populations are particularly exposed to transport pollution
because they often live close to major roads,” said Mr. Purka.
ADB actively supports private sector participation in infrastructure
development, clean fuel and alternative fuel projects and gas
distribution. ADB’s board of directors approved the proposed investment
in CUGL in early 2006.
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