In Washington, DC:
Zibu Sibanda
Phone: +202-473-0605
E-mail: zsibanda@ifc.org

In New Delhi:
Minakshi Seth
Phone : +91 11 4111 1000
E-mail: mseth@ifc.org


Washington, DC, August 27, 2007 — IFC has agreed to provide financing to Gujarat State Petronet Limited to support the expansion of its natural gas transmission network in the state of Gujarat, India. This project will help Gujarat significantly reduce harmful environmental emissions, while making energy cheaper for private and commercial users by displacing more expensive imported fuels.

IFC’s financing to Gujarat State Petronet Limited includes a loan of 3.375 billion rupees and equity of up to $30 million. The company, India’s second-largest natural gas transmission firm, is the only one that transports gas on behalf of third-party shippers. Its gas transmission network spans 1,080 kilometers, and discussions are underway to expand by 800 kilometers over the next three years.

“We welcome IFC’s support, which will help make us a strong player in gas transmission in western India.  Our company will continue its vision to provide cleaner and more efficient fuel to the power, fertilizer, and other industrial sectors, as well as to transport and domestic users in Gujarat,” said
D. Rajagopalan, Indian Administrative Service, Chairman of Gujarat State Petronet Limited.

“We are pleased to partner with Gujarat State Petronet Limited, a leading player in the Indian natural gas market, whose vision is to meet a rapid growth in demand,” said Rashad Kaldany, IFC Director for Infrastructure. “With its focused strategy, successful track record, and strong presence in Gujarat state, the company is well positioned to take advantage of promising market opportunities. IFC is providing flexible, growth-oriented corporate financing to help the company expand, enabling it to provide environmentally clean fuel.”

India has substantial financing needs in infrastructure, which are estimated at $350 billion over the next five years. Private sector participation and the successful implementation of public-private partnerships are critical to reach the country’s ambitious goals for infrastructure development.  

“This investment is an important part of IFC’s strategy to address India’s need for more environmentally clean sources of energy. Such investments lead to greater efficiency in the delivery of gas,” commented Paolo M. Martelli, IFC Regional Director for South Asia.
 
This project supports IFC’s strategy in India, which fosters pioneering private projects and public-private partnerships through investments, resource mobilization, and advisory services to improve infrastructure facilities. In the gas sector, IFC aims to address the country’s need for cleaner sources of energy at competitive costs.

About IFC
IFC, a member of the World Bank Group, fosters sustainable economic growth in developing countries by financing private sector investment, mobilizing capital in the international financial markets, and providing advisory services to businesses and governments. IFC’s vision is that poor people have the opportunity to escape poverty and improve their lives. In FY06, IFC committed $8.3 billion, including loan participations, to 284 investments in 66 developing countries. For more information, please visit www.ifc.org.

About Gujarat State Petronet Limited
Gujarat State Petronet Limited is a public-private partnership established in 1998 by Gujarat State Petroleum Corporation Limited, a Government of Gujarat owned E&P (Exploration and Production) Company. GSPL, a publicly listed company, constructs and manages a state-wide gas transmission network, which operates on third party, open access basis in the state of Gujarat. The majority of its customers are power, fertilizer, chemical, and steel plants that purchase natural gas directly from suppliers, as well as several local gas distribution companies that supply natural gas to retailers, as well as small and medium industrial consumers. For more information, please visit www.gujpetronet.com.