1.

INTRODUCTION

1.1. CITY GAS DISTRIBUTION SYSTEM

1.1.1. What is City Gas Distribution?
A City gas distribution means a distribution system in which CNG & PNG sold to various
segments by interconnecting gas pipeline & related equipments. In CGD system, high
pressure steel pipeline has been laid across various areas of city. The city gas distribution
accounts for 4-6 MMSCMD in the country. It is assumed to increase to an amazing 20
MMSCMD in the next three years.
The city gas distribution in the India is increasing at a rapid rate for the usage of PNG for the
domestic, commercial, industrial and CNG for transportation. Two factors that will drive this
growth are increase in gas production and the development of the infrastructure.

1.1.2. History of City Gas Distribution
The CGD business in India dates back to 1857 when Calcutta Gas Company & Bombay Gas
Company commenced operations in Kolkata and Mumbai respectively, with coal gas as the
primary input. Subsequently however, the industry remained by and large dormant, until Oil
and Natural Gas Corporation Limited (ONGC) and Assam Gas Company Limited entered the
business in the mid late 1980s.
The real impetus to the sector came from the establishment of Gujarat Gas Company Limited
(GGCL), Mahanagar Gas Limited (MGL), and Indraprastha Gas Limited (IGL), which began
operations in the late 1980s to mid 1990s.
Since the late 1990s, the CGD business has grown at a rapid pace in India, on the strength of
the Supreme Court mandate for the mandatory conversion of commercial automotives in
some cities from traditional liquid fuels to CNG, as well as the favourable economics of such
conversion for end-users. These factors have drawn number entrants to the CGD business in
the recent posts.


2

Taking a look in the Indian history, the CGD started in the late 1800s. The following is a summary
regarding the history of CGD in India:
Table 1.1 CGD Companies in India
S. No. Year Location Company
1 ~1880 Kolkata (then
Calcutta)
Calcutta Gas
Company
2 ~1900 Mumbai Bombay Gas
Company
3 1972 Vadodara Vadodara Municipal
Corporation
4 1980 Delhi Delhi Municipal
Corporation
5 1982-1986 ONGC colony at
Mehsana and
Sibsagar
ONGC
6 1985 Duliajan Assam Gas Company
7 1989-1991 Surat, Ankleshwar,
Bharuch
Gujarat Gas
Company Limited
8 1994 Mumbai Mahanagar Gas
Limited
9 1995 Delhi Indraprastha Gas
Limited
10 2004 Vadodara,
Ahemdabad,
Faridabad & Khurja
Adani Gas Limited
11 2005 Hyderabad Bhagyanagar Gas
Limited
12 2006-2007 Gandhinagar, Kadi,
Mehsana, Rajkot,
Morbi, Vapi

GSPC Gas/
Sabarmati Gas
13 2006 Kanpur, Lucknow CUGL, GGL

3


1.2. GSPC
Gujarat State Petroleum Corporation (GSPC) is the chief of its related group that holds eight other
huge companies. It is the key ship that sails through and commands the fleet of ships, holding the
flag strong and high, wading through deep waters towards success.
As a leading oil and gas exploration, development and Production Company in India, GSPC
GROUP is also one of the largest gas trading companies in the country. With a significant presence
in the gas transmission and gas distribution business, GSPC's activities are also both onshore and
offshore in India and overseas. The Government of Gujarat along with its public sector undertakings
holds more than 97% of equity of Gujarat State Petroleum Company GROUP as on 31st March
2010.
Currently developing production for commercial domains, GSPC Group's principal and most
crucial asset is Deen Dayal field in the Krishna-Godavari basin. Located off the east coast of the state
of Andhra Pradesh, India, it is a significant gas reserve. The west part of the Deen Dayal Reserves
(DDW) is being explored for commercial production. GSPC is the primary operator of the offshore
KG-OSN-2001/3 block (the KG Block) which includes the Deen Dayal field. GSPC hold an 80.0%
working interest in this block specifically.
The working blocks of GSPC are spread around the world. Apart from holding working interests
in 15 producing fields in the Cambay basin, GSPC also holds working interests in 64 onshore and
offshore explorations and production blocks. 53 of these blocks are located in India and the other 11
comprise of reserves in locations like Australia, Egypt, Indonesia and Yemen.
GSPC conducts all its exploration, development and production activities through unincorporated
joint ventures with other domestic oil and gas companies and foreign partners and PSCs and PSAs.
GSPC operate the largest gas transmission and distribution network in the state of Gujarat. GSPC
work through its subsidiaries and associates to supply gas services across the state. Gujarat State
Petronet Limited (GSPL) is a gas transmission company working on a common carrier basis. GSPS
Gas and Sabarmati Gas are two entities engaged in City Gas distribution and related pipeline
infrastructure and Piped Natural Gas services. Both the bodies have developed their Pipeline

4

Infrastructure and supplying services of PNG to domestic customers, commercial and non
commercial sectors as well as industrial domains.
GSPC also trades in Liquefied Natural Gas (LNG) and cater to industries engaged in power
generation, steel and city gas distribution among several other domains.
Apart from the above mentioned activities, GSPC is also active in several other areas through its
various initiatives. Under its wholly owned subsidiary, GSPC LNG Limited, GSPC is developing an
LNG terminal at Mundra in Gujarat. GSPC's associate company Gujarat State Energy Generation
Limited also owns and operates a gas based power plane at Hazira in Gujarat. GSPC Pipavav Power
Company Limited (GPPC), one of GSPC's subsidiaries is setting up a gas fired combined with cycle
power plant at Pipavav in Gujarat. Another set up of GSPC Group is a wind farm in Jakhau in
Gujarat.

1.2.1. GSPC GAS Indias largest CGD Company
GSPC Gas Company Ltd., a group company of the Gujarat State Petroleum Company (GSPC)
Group has been established to complete the presence of GSPC in the Energy Value Chain. GSPC
Gas always works towards a principal aim to supply natural gas to retail customers, i.e. Domestic,
Commercial/Non-Commercial, SMEs and CNG. GSPC Gas is playing a vital role to cater to the
natural gas demand up to the last mile of the retail network. GSPC Gas is envisioned to be
complementary to Gujarat State Petronet Ltd. (GSPL), which is evident from the presence of GSPC
Gas retail network starting at every point and location that the GSPL network ends.
1.1.2.1. Main Segments (Status on 15th June 2012)
GSPC Gas is catering to the Natural Gas requirements of all the retail segments, which comprise of
industrial, commercial, transportation and residential customers.
GSPC Gas is supplying natural gas to more than 3,47,909 domestic households, 1,292 commercial
and non-commercial segments and 1,629 industrial customers. GSPC Gas also supplies natural gas in
the form of Compressed Natural Gas (CNG) through 137 CNG stations across the state that caters to
more than 75,000 vehicles per day. Presently, the daily gas sales volume is in tune of 4.3 MMSCMD
catering to a variety of domains and segments for various applications through PNG and CNG.

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2. NATURAL GAS

Natural Gas is a vital component of the world's supply of energy. It is one of the cleanest, safest,
and most useful of all energy sources. Despite its importance, however, there are many
misconceptions about natural gas. The 'gas' in the common barbecue is actually propane, which,
while closely associated and commonly found in natural gas, is not really natural gas itself. Below is
a bit of background information about natural gas, what exactly it is, how it is formed, and how it is
found in nature.


2.1. What is Natural Gas?

Natural Gas is gaseous fossil fuel consisting primarily of Methane. It may also content other
gaseous heavier hydro carbon namely , Ethane, Propane Butane etc .Some time Nitrogen, helium,
Carbon dioxide, Traces of Hydrogen sulfide & water is also present in Natural gas . Mercury is also
present in small amount in some field .The Exact composition of Natural gas varies between gas
fields.

2.2. Composition of Natural Gas can be given as in the tabular form:-

Table 1.2 Composition of Natural Gas
S.NO. NAME OF THE
CONSTITUENT
CHEMICAL
FORMULA
PERCENTAGE
1 Methane CH4 70%-90%
2 Ethane C2H6 0%-20%
3 Propane C3H8 0%-20%
4 Butane C4H10 0%-20%
5 Carbon Dioxide CO2 0%-8%
6 Oxygen O2 0%-0.2%
7 Nitrogen N2 0%-5%
8 Hydrogen Sulphide H2S 0%-5%
9 Rare Gases A, He, Ne, Xe Traces

6


2.3. Properties of Natural Gas

The following are the properties of natural gas:
1. Natural Gas is colorless, odorless clean gas.
2. It is lighter than Air so tend to dissipate.
3. Properties of natural gas vary to some extent with the composition of gas.
4. Explosive concerns of compressed natural gas are almost non-existent.
5. Processed natural gas is, in itself, harmless to human body.
6. Natural gas is a simple asphyxiated particularly in confined place and can kill if it displaces air.
7. Natural Gas has high calorific value i.e. burning a particular amount of it gives a higher value of
heat.


2.3.1. Physical Properties

Table 1.3 Properties of Natural Gas
S.NO. PROPERTY DESCRIPTION
1 Appearance Clear Gas; burns with
blue flame
2 Density and Phase 0.717 kg/m3 ; Gaseous
State
3 Boiling Point (-)161.60C
4 Flash Point (-)1880C
5 Explosive Limit 5%-15% in air
6 Flash Temperature 21480C
7 Auto ignition
temperature
1100 0F


7

2.3.2. Flammability Range of Natural Gas

Fig. 1.1 Flammability Range



2.3.3. The Fire Tetrahedron

Current thinking suggests there is a fourth necessity for combustion to occur: chemical reaction.
Combustion is actually a sustained chemical reaction that combines oxygen and fuel and produces
heat. Even if sufficient heat is present for ignition, combustion will not start or continue without this
chemical reaction. If you remove any one of the four components of the fire tetrahedron, or break the
connection between two of them, combustion cannot occur.

Fig. 1.2 Fire Triangle



8

2.3.4. Critical point

Critical temperature of natural gas : -82.7 C
Critical pressure of natural gas : 45.96 bar

Table 1.4 Critical Points of Natural gas


2.3.5 Structure of Methane
Fig. 1.3 Structure of Methane

Gaseous phase S.N PROPERTY VALUE
1 Gas density (1.013 bars at boiling
point)
1.819 kg/m3
2 Gas density (1.013 bars at boiling
point)
0.68 kg/m3
3 Compressibility Factor (Z) at STP 0.998
4 Specific gravity (air = 1) at STP 0.55
5 Specific volume) at STP 1.48 m3/kg t

9

2.3.6. Properties of methane:

Table 1.5 Properties of Methane
S.N PROPERTY VALUES
1 Molecular weight 16.03 g/mol
2 Melting point -182.5 C
3 Latent heat of fusion (1,013
bar, at triple point)
58.68 kJ/kg
4 Liquid density (1.013 bar at
boiling point)
422.62 kg/m3
5 Liquid/gas equivalent
(1.013 bars and 15 C)
630 volume/volume
6 Boiling point (1.013 bar) -161.6 C
7 Latent heat of vaporization
(1.013 bars at boiling point)
510 kJ/kg
8 Heat capacity at constant
pressure (Cp) (1 bar and 25
C)
0.035 kJ/(mol. K)
9 Heat capacity at constant
volume (Cv) (1 bar and 25
C)
0.027 kJ/(mol. K)
10 Ratio of specific heats
(Gamma :Cp/ Cv) (1 bar
and 25 C)
1.305454
11 Viscosity (1.013 bar and 0
C)
0.0001027 Poise
12 Thermal conductivity
(1.013 bar and 0 C) 32.81
32.81



10



2.4. Formation of Natural Gas

Natural gas is a fossil fuel that can be formed in different ways. The widely held theory of the
origin of natural gas is that it is composed of the remnants of decayed plant and animal matter
that has been subjected to immense pressure under the earths crust over millions of years. This
formation of natural gas is referred to as thermogenic methane and it is made in a similar fashion
to oil.

Natural gas is made up of a combination of gases, which consists largely of methane (CH4)
with lesser amounts of ethane, propane and butane as well as nitrogen, carbon dioxide and traces
of some other gases. The individual proportions of each of the components can vary based on
where the natural gas has been located.


Fig. 1.4 Petroleum and Natural Gas Formation







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2.5. Sources of Natural Gas

There are two types of sources of natural gas:-
1. Conventional Sources
2. Unconventional Sources

Conventional Sources: there are two types of sources under this category:
Non-Associated Gas:- Non Associated Gas sometimes called as Gas well gas is
produced from geological formation that typically do not contain much higher
hydrocarbon than Methane .Non associated gas can contain hydrocarbon gases such as
carbon dioxide , hydrogen sulphide etc. The reservoirs of Non-associated Gas that
contains only gas but no oil. It may be dry and wet
Associated Natural Gas: - Natural Gas is often found dissolved in oil at the high
pressure existing in a reservoir and it may be present as a Gas Cap above the oils. Natural
Gas available from such sources is known as Associated Gas. An associated gas may
contain more heavy fractions (Ethane & Higher Hydrocarbons) than non associated gas.


2.6. Natural World Scenario

2.6.1. World
Oil accounts for between 34% and 37% of the world's primary energy. The world had
proven oil reserves of 1469.6 billion barrels and natural gas reserves of 6,647,341billion
cubic feet, with Natural gas production 309 billion cubic feet in 2010-11
Crude oil production in the world was 87,500,000 barrels per day in 2010-11 out of
which Saudi Arabia accounted for 88,00,000 barrels per day.
The global energy consumption slowed down in 2008-2009 given the global economic
slowdown and high energy prices. This was true for each of the fossil fuels. This
slowdown was in sharp contact to the above average growth taking place for the past five
years. The consumption grew paltry 1.4% in 2008-2009 as compared to 2.4% on 2007-
2008

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Unlike oil, global natural gas consumption grew by 2.5% in 2008. The largest
incremental growth came from China with a consumption growth of 15.8%.
The worlds proven reserves of natural gas have steadily increased from 109.72 trillion
cubic meters (TCM) in 1988 to 6,647,341billion cubic feet at the end of 2010 as a result
of innovations in exploration and extraction techniques.
The level of reserves has shown an impressive growth of 4.5%from 2007 levels. At the
current of production, the natural gas reserves will last for 60 years.

Table 1.6 Natural Gas Reserves
RANK COUNTRY PERCENTAGE
1 Russian Federation 19.6%
2 United States 19.3%
3 Canada 5.7%
4 Iran 3.8%
5 Norway 3.2%
6 Algeria 2.8%
7 Saudi Arabia 2.5%
8 Qatar 2.5%
9 China 2.5%
10 Ukraine 2.3%
11 Indonesia 2.3%
12 The Netherlands 2.2%

2.6.2. India

Natural Gas Despite major new natural gas discoveries in recent years, India is
considering large-scale imports via pipelines and LNG terminals to help meet growing
demand.
According to Ministry of Petroleum India has total reserves of 775 million metric tons
(MT) of crude oil and 1074 billion cubic meters (BCM) of natural gas as on April 1,
2009.

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The bulk of Indias natural gas production comes from the western offshore regions,
especially the Mumbai High complex. The onshore fields in Assam, Andhra Pradesh,
and Gujarat states are also significant sources of natural gas. The Bay of Bengal has also
become an important source of natural gas for the country.
Domestic production of crude oil was 31.41 MMT in 2010-11.
Refinery production in terms of crude throughput increased to 136.46 MMT in 2010-11.
The production of natural gas went up to 44030 million cubic meters tons (MCM) in
2010-10.
Natural gas demand is expected to grow considerably, largely driven by demand in the
power sector. The power and fertilizer sectors account for nearly three-quarters of
natural gas consumption in India.
By 2030, EIA expects Asian demand for natural gas to more than double, and India is
expected to be responsible for a sizeable part of that growth. Natural gas is expected to
be an increasingly important component of energy consumption as the country pursues
energy resource diversification and overall energy security.
Although Indias natural gas production has consistently increased, demand has already
exceeded supply and the country has been a net importer of natural gas since 2004.
Indias net imports reached an estimated 353 Bcf in 2007. India imports natural gas via
liquefied natural gas (LNG).


2.7. Important Uses of Natural Gas

Cooking
Heating / Furnaces
Transportation
Air conditioning
Power Generation
Gas fireplace


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2.8. WHAT IS CNG & PNG?

2.8.1. CNG(Compressed Natural Gas)
CNG (compressed natural gas) is natural gas mainly containing methane which is
compressed upto 250 bar; used as vehicular fuel in vehicles running on CNG kits.
It has a Research Octane Number in excess of 120. The excellent knock resisting
property of CNG allows for use of a higher compression ratio resulting in an increased
power output and greater fuel economy when compared to petrol.
CNG can be used in engines with a compression ratio as high as 12:1 compared to normal
gasoline (7.5:1 to 10:1). At this high compression ratio, natural gas-fuelled engines have
higher thermal efficiencies than those fuelled by gasoline.

The following are the benefits of using CNG over other conventional resources:

1. Green Fuel

Commonly referred to as the green fuel because of its lead and sulphur free character, CNG
reduces harmful emissions. Being non-corrosive, it enhances the longevity of spark plugs. Due to
the absence of any lead or benzene content in CNG, the lead fouling of spark plugs and lead or
benzene pollution are eliminated.

2. Increased life of Oil

Another practical advantage observed is the increased life of lubricating oils, as CNG does not
contaminate and dilute the crankcase oil.

3. Mixes evenly in Air

Being a gaseous fuel CNG mixes in the air easily and evenly.



15

4. Safety

CNG is less likely to auto-ignite on hot surfaces, since it has a high auto-ignition temperature
(540 0C) and a narrow range (5%-15%) of inflammability. It means that if CNG concentration in
the air is below 5% or above 15%, it will not burn. This high ignition temperature and limited
flammability range makes accidental ignition or combustion very unlikely.

5. Low Operational Cost

The operational cost of vehicles running on CNG, as compared to those running on other fuels, is
significantly low. At the prevailing price of fuel in Gujarat, operational cost of CNG vehicles is
68% lower than petrol and 36% lower than diesel.


2.8.2. PNG(Piped Natural Gas)

Natural gas which is maintained at low pressure less than 4 bar and carried by poly ethylene
pipeline mainly used for cooking in houses and various industrial purposes.
The ratio of carbon to hydrogen is least in methane and hence it burns almost completely making
it the cleanest fuel. It is procured from the oil / gas wells and transported through a network of
pipelines across the country. PNG has several distinctions to its credit- of being a pollution-free
fuel, easily accessible minus storage troubles, and being available at very competitive rates.

The following are the benefits of using PNG:

1. Uninterrupted Supply

PNG offers the convenience of ensuring continuous and adequate supply of NG through pipeline,
without any storage of gas in cylinders.



16


2. Unmatched Convenience

The domestic consumers have to take upon themselves the trying task of booking an LPG
cylinder refill, time and again starts the wait for the deliveryman to deliver the cylinder.
Switching over to PNG renders this entire exercise unnecessary. PNG also eliminates the tedious
routine of checking LPG refill cylinder for any suspected leakage, or it being underweight, at the
time of delivery. Precious space, occupied by LPG cylinders is also saved.

3. Safety

The combustible mixture of natural gas and air does not ignite if the mixture is leaner than 5%
and richer than 15% of the air-fuel ratio required for ignition. This narrow inflammability range
makes NG one of the safest fuels in the world.
Natural gas is lighter than air. Therefore, in case of a leakage, it just rises and disperses into thin
air given adequate ventilation. But LPG being heavier will settle at the bottom near the floor
surface.

A large quantity of LPG is stored in liquefied form in a cylinder. With PNG, it is safer since
PNG installation inside your premises contains only a limited quantity of natural gas at low
pressure i.e. 21 millibar (mbar).
On leakage, LPG expands 250 times, which is not the case with PNG. Supply in PNG can be
switched off through appliance valve (inside the kitchen) and isolation valve (outside kitchen
premises), which fully cuts off the gas supply.

4. Billing

The user is charged only for the amount of PNG used, and no pilferage is possible with PNG as
the billing is done according to the meter. A unique feature is that the user gets to pay only after
consumption of gas. The domestic consumer pays the PNG bill only once in two months.

17

Moreover, there are no minimum consumption charges ie, if there hasnt been any consumption,
there shall not be any bill.
The user pays the gas consumption charges based on the exact consumption reading provided by
the meter installed at his premises. The bill is delivered at the users doorstep.

5. Environment Friendly

Natural gas is one of the cleanest burning fossil fuels, and helps improve the quality of air,
especially when used in place of other more polluting energy sources. Its combustion results in
virtually no atmospheric emissions of sulphur dioxide (SO2), and far lower emissions of carbon
monoxide (CO), reactive hydrocarbons and carbon dioxide, than combustion of other fossil fuels.

6. No Daily Liaisoning

The consumer is spared the task of liaisioning with oil companies and co-coordinating with them
for ensuring the daily supply of fuel, because PNG is supplied directly through pipes. The daily
bills, settlements and reconciliation are also avoided as the consumer is billed once a month, and
that too as per the meter reading.

7. No Spillage or Pilferage

In case of fuels like HSD and LDO, there are considerable chances of spillage and pilferage. In
case of PNG these losses are invariably done away with, for PNG is supplied through pipes.


Major User Segments:

1. For PNG 2. For CNG
Domestic Automobile
Industrial
Commercial

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2.8.2.1. Domestic Applications

Natural gas is one of the cheapest forms of energy available to the residential consumer.
In fact, natural gas has historically been much cheaper than electricity as a source of
energy.
Not only is natural gas cheap for the residential consumer, it also has a number of varied
uses. The best known uses for natural gas around the home are natural gas heating and
cooking.
Cooking with a natural gas range or oven can provide many benefits, including easy
temperature control, self ignition and self cleaning, as well as being approximately one-
half the cost of cooking with an electric range.
Many of the top chefs prefer natural gas ranges for their quick heating ability and
temperature control.
Modern top of the line gas furnaces can achieve efficiencies of over 90 percent (meaning
that only 10 percent of the energy contained in the natural gas is lost as waste heat). Even
low-end natural gas furnaces achieve high efficiencies, around 78 percent. In addition to
heating homes, natural gas can also be used to help cool houses, through natural gas
powered air conditioning.
Natural gas appliances are also rising in popularity due to their efficiency and cost
effectiveness. Although many gas powered appliances are initially more expensive than
their electric counterparts, they are commonly much cheaper to operate, have a longer
expected life, and require relatively low maintenance.

2.8.2.2. Industrial Applications
Natural gas has a multitude of industrial uses, including providing the base ingredients
for such varied products as plastic, fertilizer, anti-freeze, and fabrics.
In fact, industry is the largest consumer of natural gas, accounting for 43 percent of
natural gas use across all sectors.
Natural gas is the second most used energy source in industry, trailing only electricity.
Lighting is the main use of energy in the industrial sector, which accounts for the
tremendous electricity requirements of this sector.

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The graph below shows current as well as projected energy consumption by fuel in the
industrial sector.


Fig. 1.5 Graph showing usage of different natural resources over time



Industrial applications for natural gas are many. Industrial applications include those same uses
found in residential and commercial settings heating, cooling, and cooking.
Natural gas is also used for:-
Waste treatment and Incineration
Metals Preheating (particularly for iron and steel)
Drying and Dehumidification
Glass Melting
Food Processing
Fueling industrial Boilers

Feed Stock for manufacturing various chemical products.
Gases such as butane, ethane, and propane may be extracted from natural gas to be used
as a feed.

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Stock for such products as fertilizers and pharmaceutical products.
Natural gas as a feedstock is commonly found as a building block for methanol, which in
turn has many industrial applications.
Natural gas is converted to what is known as synthesis gas, which is a mixture of
hydrogen and carbon oxides formed through a process known as steam reforming.
Natural gas desiccant systems, which are used for dehumidification, are increasingly
popular in the plastics, pharmaceutical, candy, and even recycling industries. In each of
these industries, moisture filled air can lead to damage of the end product during its
manufacture.
Natural gas absorption systems are also being used extensively in industry to heat and
cool water in an efficient, economical, and environmentally sound way. These industrial
absorption systems are very similar to those used in commercial settings.

2.8.2.3. Commercial Applications
Commercial uses of natural gas are very similar to residential uses. The commercial
sector includes public and private enterprises, like office buildings, schools, temples,
hotels, restaurants, and government buildings.
The main uses of natural gas in this sector include space heating, water heating, and
cooling. For restaurants and other establishments that require cooking facilities, natural
gas is a popular choice to fulfill these needs.
Natural gas space and water heating for commercial buildings is very similar to that
found in residential houses. Natural gas is an extremely efficient, economical fuel for
heating in all types of commercial buildings.
Cooling and cooking represent two major growth areas for the use of natural gas in
commercial settings.
Natural gas currently accounts for 13 percent of energy used in commercial cooling, but
this percentage is expected to increase due to technological innovations in commercial
natural gas cooling techniques.
Natural gas is also an economical, efficient choice for large commercial food preparation
establishments. New developments such as Non Traditional Restaurant Systems, which
provide compact, multifunctional natural gas appliances for smaller sized food outlets

21

such as those found in shopping malls and airports, are expanding the commercial use of
natural gas.
Many buildings, because of their high electricity needs, have on-site generators that
produce their own electricity. These types of 'distributed generation' units offer
commercial environments more independence from power disruption, high-quality
consistent electricity, and control over their own energy supply.

2.8.2.4. CNG in Automobiles
Natural gas has long been considered an alternative fuel for the transportation sector. In
fact, natural gas has been used to fuel vehicles since the 1930's!
Some natural gas vehicles that exist today are bi-fuel vehicles, meaning they can use
gasoline or natural gas, allowing for more flexibility in fuel choice. Many of these
vehicles, which were originally gasoline, only, have been converted to allow the vehicle
to run on either fuel. This conversion is costly, and typically results in less efficient use of
natural gas.

















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3. COMPONENTS OF A CITY GAS DISTRIBUTION SYSTEM

1. City Gate Station (CGS)
2. Odourisation Unit
3. District Regulating System (DRS)
4. Service Regulator (SR)
5. Gas metering system
6. Pipe Line System
7. CNG Equipments
8. SCADA system


Fig. 1.6 Schematic Layout of City Gas Distribution System




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3.1. City Gate Station(CGS)

A city gate station is a place, mainly established at a tap-off point of high pressure transmission
pipeline; from where we get gas inside the city via pipelines. The gas delivered at this point is at
higher pressure i.e greater than 40 bar. Once gas gas enters to CGS unit its pressure is reduced to
in between 25-30 bar.

City gate stations are composed of a complex array of valves, pipes, and pressure reduction
devices designed to meter the gas and reduce its pressure so that it can be delivered safely to
customers through distribution.

A city gate station consists of various skids for different- different purposes listed as:-

3.1.1. Filtration Skid
Gas enters in the knock out drum which is in a shape of a vertical cylinder. All the dust particle
and liquid coming with the gas stream are seperated by high efficient filters. Gas is maintaining
same pressure from the inlet to the filteration skid. After the filteration two streams are divide
from the main line using a header. Line which is in function is known as active line where
another one is called passive line.

3.1.2. Pressure Reduction Unit
A pressure reduction valve is installed for the reduction of the gas stream pressure from 40-45
bars to 25-30 bars. Creep relief valve and Slam Shut off valve is being installed in this skid for
the safety purpose.

3.1.3. Metering Skid
Metering skid is installed for the gas flow measurement. Orifice meter is used in this metering
skid; because of the large pressure drop requirement. The various parameters such as temperature
in the various sections of the line pressure at the inlet & outlet joints, flow inlet & outlet are
monitor by the SCADA systems in the control room.

24


3.2. Odorization Unit

As the natural gas is odorless, Ethyl Mercaptan is being added in natural gas. An Odourization
unit is installed for addition of ethyl mercapatan in the gas stream. The dozing unit of the ethyl
mercaptan should be of 9 mg/m3. This unit consists of mainly two cyliders of capacity of 160 kg,
pneumatic pannel, level indicator and a filter. This unit is directly connected to the main line
after the metering skid.


Fig.1.7 Odorization Unit





25

Fig. 1.8. Section of pipelines showing pressure and temperature regulating devices





26

Fig. 1.9. Figure showing different types of valve installed





27


3.3. District regulating System(DRS)

DRS is the device used to reduce the pressure from 25 bar to 4 bar. It is the interface between
the steel grid network and medium pressure network. The various components of the DRS are
Filtration Skid
Pressure Reduction Skid
Slam Shut off Valves for controlling flow

The normal range of pressure in the district regulating system at inlet is 19-26 bar & at outlet is 4
bar. The flow capacity of DRS is in range of 5000-10000 SCMH. The inlet line of DRS is steel
pipeline and outlet is polyethylene pipeline carrying a pressure of 4 bar.


Fig. 1.10 Figure showing District Regulating Unit


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3.4. Service Regulators(SR)

These are installed before tertiary PE lines, generally located at customer premises for
maintaining supply pressure and designed to maintain safe condition even in the event of rupture
in the regulating downstream section. It reduces the pressure from 4 bar to 110 mbar to the
service device. These regulators maintain the required maximum and minimum pressure with
shut off device. The types of regulators that are used generally depend upon the number of
connection. Various types of service regulators available are listed in following table.

Table 1.7 Types of Service Regulators

S.N Type Flow Rate Maximum Capacity
1 B-6 6 m3/hr 1-8 domestic
connections
2 B-10 & FE-10 10 m3/hr 1-20 domestic
connections
3 B-25 & FE-25 25 m3/hr 1-30 domestic
connections
4 B-50 & FE-50 50 m3/hr 1-75 domestic
connections



3.5. Metering System

Meters are the important part of CGD. It decides or gives the information about the amount of
gas sold to the customer. Billing of gas is usually done based on the standard conditions i.e.
SCM. Meters are used based on type of the customer and his requirements.
Meter used for the domestic customer is of diaphragm meter, which is having a flow range of
0.017 to 2.6 m3/hr. with a maximum operating pressure of 0.1 bar.

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Meter used for commercial & industrial customers is depend upon the flow & pressure
requirement. Mainly PD/RPD/Turbine meter is being used for commercial & industrial
customers.

Fig. 1.11 Metering System




3.6. Pipeline System

Pipeline network consists of steel pipeline & polyethylene pipeline. A typical CGD network
should consists of the following

3.6.1. Primary Network
A medium pressure distribution system comprising of pipelines, gas mains or distribution mains
normally constructed using steel pipes and connects one and more transmission. Pipeline to
respective CGS or one or more CGS to one or more DRS.


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3.6.2. Secondary Network
A low pressure distribution system comprising of gas mains or distributions mains usually
constructed using thermoplastic piping (MDPE) and connects DRS to various service regulators
at commercial, industrial and domestic consumers.

3.6.3. Tertiary Network
A service pressure distribution system comprising of service lines, service regulators and
customer/consumer meter set an assembly constructed using a combination of thermoplastic
(MDPE) piping and GI/copper tubing components. The connection between consumer meter set
assembly and gas appliance (provided by consumer) may be made by GI pipes or copper tubing
or steel reinforced rubber hose.


3.7. Communication Systems-SCADA

The Supervisory Control and Data Acquisition (SCADA) system at the main control room
receives all the field data and presents it to the operator through a set of screens or Human
Machine Interface, showing the operational conditions of the field. The operator can monitor the
hydraulic conditions of the line, as well as send operational commands (open/close valves, turn
on/off compressors or pumps, change set points, etc.) through the SCADA system to the field.
To optimise and secure the operation of these assets, CGD companies use SCADA. Software
tools installed on top of the SCADA system, that provide extended functionality to perform leak
detection, leak location, batch tracking (liquid lines), pig tracking, composition tracking,
predictive modelling, look ahead modelling, operator training and more.

A SCADA's System usually consists of the following subsystems:

A Human-Machine Interface or HMI is the apparatus which presents process data to a
human operator, and through this, the human operator monitors and controls the process.
A supervisory (computer) system, gathering (acquiring) data on the process and sending
commands (control) to the process.

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Remote Terminal Units (RTUs) connecting to sensors in the process, converting sensor
signals to digital data and sending digital data to the supervisory system.
Programmable Logic Controller (PLCs) used as field devices because they are more
economical, versatile, flexible, and configurable than special-purpose RTUs.
Communication infrastructure connecting the supervisory system to the Remote Terminal
Units.


























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4. CNG DISTRIBUTION SYSTEM


4.1. CNG STATION

A CNG station is an Establishment where CNG filling is done in vehicles running on CNG kits.
Main components of a CNG station are:-
Compressor- To compress the gas up to a certain pressure
Cascade- For storage of the compressed gas
Dispenser- For dispensing the compressed gas.

4.1.1. Types of CNG Stations:-
1. Mother Station: - A CNG station provided with whole set up (compressors, dispensers,
cascade etc) along with a LCV filling point is known as a mother a CNG station.

2. Online Station: - This CNG station has same set up as a mother station but LCV connection
is not provided for filling.

3. Daughter Booster Station: - Daughter station provided with the compressor (known as
boosters) to compress the gas we are getting from the mother station are known as daughter
booster station. \

5. Daughter Station: - Daughter stations are established in those areas where laying a
pipeline is not possible. In that case gas is delivered from mother station to daughter
station; via mobile cascade van. The gas from mother station is filled in mobile cascade by
a LCV filling point.




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Fig. 1.12 A CNG station



4.1.2. Working of a CNG station
Steel line of 2 inches diameter coming to compressor as a suction line of compressor is of
25 bars.
Suction line is provided with isolation valve over it followed by a strainer for removing
of foreign particles.
From strainer it comes to suction filter of size 5 micron.
From here the suction line is divided in to two lines one is inlet to 1st stage of compressor
and another one is instrument line for operating actuator valves in the compressor.
Instrument line having a pressure of 25 bar it goes to a PRV (Pressure Regulating Valve)
which reduces pressure upto 6-8 barg for the SOV which provide functioning of
Actuator.
Now the main suction line goes in Non Returning Valve (NRV) which provides only
forward movement of gas.

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From NRV it goes into Blow down Vessel. We have two interconnected Blow down
vessels. In these gas is stored which is mainly used during start up of compressor.
Now from NRV it comes to main PRV & then first Suction volume bottle from here it
enters to compressor.
Valve and Piston means in other compressors valve and piston are provided separately
but here valve is provided in the piston so function of both is performed by piston only.
The first stage is double acting stage; here compression is affected from both the ends of
the cylinder of the compressor. Then gas is sent to the intercooler for the cooling of the
gas.
Now gas from intercooler enters to second stage for the compression and again same it
goes to intercooler for air cooling of the compressed gas.
Finally it reaches to third stage for final compression from intercooler for the desired
final pressure of gas.
At every stage gas pressure rises as:-
First stage: - <70 bar
Second stage: - <140 bar
Third stage: - <245 bar
After third stage compression from intercooler it comes in discharge line.
Lubrication oil is provided for piston and crank case separately.
Oil SS220 for lubrication
Oil SS150 for Crank Case
Final discharge line goes to separator first and then filter of size of 1 micron.
Now gas enters to mass flow meter for measurement.
Water cooling is provided for the cooling of the oil used in compressor.
From mass flow meter gas comes to priority panel.

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4.2.1. Priority Panel
Discharge line coming out from the compressor is splitting into five lines in sequence as:
Direct line which is directly going to dispenser high pressure bank.
High pressure line directly going to cascade high pressure bank.
Followed by medium pressure line divided into two lines one goes to cascade and other
to dispenser medium pressure bank.
Followed by low pressure line divided into two lines one goes to cascade and other to
dispenser low pressure bank.
Last line is provided for the mobile cascade filling.
Each line is provided with Non returning valve and pressure transmitter respectively.
Priority system having the following set points :
High Bank - 220 Bar
Medium Bank 210 Bar
Low Bank 200 Bar

Each Bank diverts comp. discharge to Lower side in sequence
Auto Start 190 Bar at High Bank priority
Auto Stop at 245 Bar at all 3-Bank priority









36

Fig.1.13. Image of a priority panel





4.2.2. Safety units in compressor
Flame detectors
Gas detectors
CO2 flooding system
Vibration Switch
FSLL(Flow Switch Low Low)
SRV
Vibration Switch


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Fig. 1.14 Safety Devices at CNG station

CO2 flooding system DCP Extinguisher

Flame Detector Gas Detector

4.2.3. Gas Compressor Specifications
The following codes and standards (version/revisions valid on the date of order) are referenced to
& made part of specification:
API-11P (latest edition), API 661:1997, ASME VIII Div 1999.

38

ISO 3046/1
API 618
NFPA-37, OISD 179 and NFPA-52: 1995 or equivalent.
NFPA-12, IS:6382, Gas Cylinder Rule-2004
IS: 5571, IS: 5572, IS: 5580
ANSI,ASTM,NEC,NEMA
Indian Electricity Rules, Indian Explosive Act
Standard specifications of Bureau of Indian Standards
Specification/Recommendations of IEC

4.2.4. Cascades
A bank of cylinders used for buffer stock of compressed natural gas is known as cascade.
Stationary cascade is used to store the gas when vehicle is not there at the dispenser then the gas
from compressor flows into a cascade.

Cylinders in a cascade are divided according:

High Pressure Cylinders (HP) 5 cylinders
Medium Pressure Cylinders (MP) 11 cylinders
Low Pressure Cylinders (LP) 24 cylinders
Total 40 cylinders in cascade.







39

Fig. 1.15 CASCADE systems







The cascade having horizontal cylinders and sited parallel to other cascade, cylinder
fittings should be arranged so that they do not face cylinder fittings of other cascade.
Cylinder installed horizontally in a cascade shall be separated from another cylinder in
the cascade by a distance of not less than 30 mm.
Cascade with horizontal cylinders shall have the valves fitted on the same side within the
cascade opposite to the refueling point and arranged in a manner that any gas leakage is
discharged upwards.
Cascade/bulk units shall be installed on a firm, compacted, well-drained non-combustible
foundation. This foundation may be in the form of a plinth with the raised edge at 2 M

40

from the front and sides of the cascade forming a kerb up to which vehicles should be
permitted. The cascade shall be securely anchored to prevent floating in case flooding is
anticipated.
Gas storage facility shall be protected from the effects of the weather by a roof or canopy
designed to facilitate the dispersion of free or escaped gas and shall not permit gas to be
trapped.
Adequate means shall be provided to prevent the flow or accumulation of flammable or
combustible liquids under containers such as by grading, pads or diversion curbs.
Only dedicated trailer, truck or any other vehicle to be used for transportation of CNG
storage units. These units should have lugs fitted for lifting and in no case magnetic
device to be used for lifting purposes.
The vehicle with the cascade there own, shall be placed with easy access and egress on a
low platform or hard compacted ground, which shall extend to at least another one meter
on all sides and this platform or hard ground shall be under a light roof or canopy as
described in 7.5 above.
The trailers/ vehicle carrying CNG should be made immovable by application of brake
and wheel choke prior initiation of filling or dispensing operation. We have two types of
cascades:-
1. Stationary Cascade: These are fixed cascades established on CNG station for the
storage of CNG. It has a direct inlet from compressor and outlet to line connected to dispenser.
2. Mobile Cascade: Cascade is mounted over an LCV and it carries CNG from Mother
station to Daughter station or Daughter booster station as per the requirement.

4.2.5. Dispenser
Basically on a CNG station we have equipment called as Dispenser for dispensing gas into a
vehicle.

4.2.5.1. Components of Dispenser:
High, Medium, low bank lines
Emergency Valves

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Gas Filter
SOV
Actuator
Mother Board
Non Returning Valve (NRV)
Ball Valve
Mass flow meter
Pressure Transmitter
Safety Release Valve (SRV)
Hose Pipe
Three Way Valve
Hex Nipple
Filling Probe and O-ring
Pressure Regulating Valve

4.2.5.2. Working of Dispenser
A dispenser has three banks connection namely:-
Low pressure Bank (LP)
Medium pressure Bank (MP)
High pressure Bank (HP)

Gas from dispenser will dispense in the sequence: - firstly from low bank then medium bank and
then from high bank.
A Pressure Regulating Valve is connected to main line coming to the dispenser which is
reducing the pressure for the operation of Actuator.
For any maintenance work Emergency valves should remain closed.
After this; gas enters to Filter (size of one micron) where oil and other foreign particles removed
from the gas coming to the dispenser.


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5. PNG DISTRIBUTION SYSTEM

We have three sectors for PNG distribution:
1. Domestic
2. Commercial
3. Industrial

For the PNG distribution the gas is delivered to the District Regulating System (DRS)
from steel pipeline connected to city gate station.
Now the pressure of gas is reduced to 4 bar from 25 bar.
The gas pipeline coming out from DRS is regulated through PE (Poly ethylene) pipes.
After the DRS no steel pipe will be used for PNG distribution. The whole pipeline
network will be underground.
As the pipeline is reached to any house the pipeline installed is such that the size of
pipeline is reduced after a certain distance :-
Size of Main PE lines after DRS 180mm or 125mm
Size of pipes providing inter connection between main Pipes- 90mm or 63 mm
Size of pipes Nearest to the house- 32mm or 20mm
A service regulator is installed in the customer premise that reduces the pressure from 4
bar to 100 mbar.
The connection reached to the kitchen through GI pipes/Copper pipe.
The gas is entering in the kitchen with a pressure of 100 mbar.
A regulator is provided to reduce pressure of 100 mbar to 21 mbar.
Gas of 21 mbar pressure finally goes to the burner of stove for domestic application.
A meter is installed for the measurement of gas consumed by the customer.
At the current time the average PNG consumption is 0.6 SCMD in India.

For the industrial and commercial application, PE line of 4 bar is installed upto the customers
premise. A MRS is installed in the customer premise for the pressure regulation; it is as per the

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customer requirement generally it is maintain pressure from 4 bar to a range of 1.5 bar to .075
bar.


5.1. Comparing PNG and LPG

PNG is comparatively cheaper than LPG. The billing is done based on the consumption by the
customer.

5.1.1. PNG is safe as
The property of natural gas is that it catches fire when it forms a mixture of 5-15%
mixture with air, whereas LPG is combustible when at its 2% mixture with the air.
Since natural gas is lighter than air, in cases of leak, it just rises up and disperses in to the
air. Comparing LPG, it being denser than air settles down in case of leakage, which is
highly hazardous. The technical factor involved in this is the flammability limit of the
gas.
Large quantity of LPG i.e. around 14.2 kg of LPG is compressed into the LPG cylinders
at a pressure of 7 bar.
Whereas, the PNG installation inside the premises is very less and is only at pressure
range of 21mbar.


5.1.2. Polyethylene Pipeline
The polyethylene pipeline has various grades. The allowable grades for the city gas distribution
for piped natural gas are PE 80 and PE 100, mainly the Medium Density Polyethylene (MDPE).
The used standard of pipe is PE 100 due to its characteristics of regaining its shape after
squeezing. The available two grades of polyethylene pipes are PE80 & PE100. The designs of
both these grades are based on the long term strength of the respective materials known as MRS
(Minimum Required Strength).



44

5.1.3. Merits:
First, its lightweight, flexible and available in long coils thereby making it easy to install
and minimizing the numbers of joints in the piping system
PE pipe can be joined by heat fusion or mechanical fittings and does not corrode like
metal pipe. It provides long-term resistance to a variety of service conditions such as:
abrasion, temperature and soil shifts, bending, weathering, internal pressure, direct burial,
point loading and squeeze-off - advantages that give confidence to gas engineers the
world over to specify PE pipe for their distribution systems.
In city gas distribution PE 100 medium density polyethylene pipe is used for the
distribution of natural gas, the line is operated with maximum pressure of 4 bar.

5.2. PNG Distribution Line:

Fig. 1.16 Figure showing PNG distribution line



45


5.3. Critical Aspects of City Gas Distribution

With growing demand base and increasing supply options City Gas Distribution networks offer a
tremendous investment opportunity. However in order to tap this opportunity the developers
need to analyze several critical aspects of the project.


5.3.1. Demand Build Up
For a city gas distribution project the industrial segment provide the base load demand, which
can be captured in a shorter time frame. In contrast, build up of demand in the commercial,
transport and residential segments provide better margins but has gestation period. The project
roll out must therefore be planned to capture an optimal mix of demand
from these segments.

5.3.2. Supply
Input gas price and its terms and conditions are critical for the viability of the city gas
distribution project. Existence of Natural gas networks passing by or in proximity of the supply
sources from the city limit enhances the project feasibility by reducing the capital input gas costs.

5.3.3. Pricing of Delivered Gas
The delivered gas must be priced in such manner so as to secure a minimum level of profitability
for the promoters, while providing adequate incentive to induce targeted to customer to shift to
natural gas. Keeping this in mind gas should be priced using the alternate fuel linked pricing
methodology where gas is priced at an appropriate discount to alternate fuel prices. For example
in PNG the fuel should be priced at a discount to LPG so as to provide the customers with a
payback period of less than three years on the expenditure on setting up the connection.

5.3.4. Risk Factors
The feasibility of a city gas project is highly sensitive to the demand the company is able to
capture, and is thus exposed to demand risk. The project is also exposed to price risk due to the

46

probable mismatch in the movement of input gas price and selling price. Moreover the Indian
Gas sector does not have a well developed regulatory framework. Uncertainty exists over issues
such as licensing for setting up distribution networks, exclusivity of operator with in a
distribution zone and role of regulator in pricing of gas. This exposes projects to regulatory risk.
The project could also be exposed to the residual risk created by the difference in terms and
conditions of contracts with the suppliers and buyers.


5.4. Challenges for implementing City Gas Projects:

Need of creating vast CGD network with accelerated pace, commensurate to wide public
demand
Developing safety standards CGD specific and developing & multiply their monitoring
by the third party
Developing & multiplying core competence of skilled manpower to handle the operations
in cities after cities
Meeting public expectations;
Cheaper fuel / competitive prices by multi operators
Easy availability anywhere
Foolproof safety everywhere
Expectations are to be met by the Government, by Regulator & by CGD operators
Proper understanding of regulatory act & mechanism to avoid contradictions for synergy
with the objectives:
Logical clarity in the regulations to manage contradictions for win-win situation
Common understanding of the act to be read as a whole to make it effective &
workable for the public good

47

Natural justice appear to prevail for comparing equals with equals and not with un-
equals
Too much control not to dampen the spirit of free competition
Regulatory systems to have:
Gas availability / allocation to all CGD entities, which are not gas producer or marketer
Gas purchase pricing for CGD at affordable price for public good
Single window clearance from various statutory bodies
Sharing of resources like equipment, inventories at reasonable prices
Pipeline connectivity from pipeline infrastructure provider
Prioritization of what is expected of CGD:
CNG PNG Industrial segments
















48



References

1. Material from website
a. Natural Gas is one of the principle sources of energy for many of our day-to-day
needs and activities. http://www.naturalgas.org/overview/overview.asp
b. Availability of Domestic Natural Gas in India (2012-2013 to 2014-2015)
http://www.indiastat.com/petroleum/25/salesmarketingandconsumptionofpetroleumpr
oducts/248/stats.aspx

c. Supply and Demand of Petroleum Products in India (During 1998-1999 to 2024-
2025).
http://www.indiastat.com/petroleum/25/salesmarketingandconsumptionofpetroleump
roducts/248/stats.aspx
d. Other images and tables from - http://www.google.co.in/
2. Referred Books
a. City Gas Distribution in India-Key Trends & Outlook, Crisil Infrastructure Advisory
b. Operation and Maintenance manuals1-6, 3
rd
edition, GSPC GAS