Abu Dhabi-based Al Manhal International Group (Amig) has signed two agreements with Australia LNG (ALNG) to obtain liquefied natural gas and now plans to lay a network of natural gas pipelines in India.

Amig has signed MoUs with three state governments and is offering Indian institutional investors an equity stake in its $450 million Gopalpur LNG project in Orissa, a top Amig official said.

"The project has moved from the vision and concept stage and will soon be a reality. Apart from the five million tonnes per annum LNG receiving and regassification terminal at Gopalpur, we plan to lay a network of pipelines and undertake distribution and marketing of natural gas in many Indian cities," said Bruce Gordon, Amig senior consultant for energy.

The ambitious initiative is being developed by Amig, New Delhi-based Vavasi Oil and Gas and the Industrial Promotion and Investment Corp of Orissa.

The Amig-Vavasi combine has signed MoUs with companies in Punjab, Uttar Pradesh and West Bengal, and will shortly sign up with some other states, he said.

The Gopalpur LNG project is progressing now that a company has been formed. Negotiations are underway with potential investors.

Lahmeyer International is conducting the feasibility study for the planned Gopalpur Power to be set up with an investment of $1.6 billion, and India's Triune and Australia's J.P. Kenny are advisors on pipeline sizing and routing. Indian company CES Ltd is conducting a marine study and Tata AIG will prepare the environment impact statement.

"The entire project is poised to serve the energy needs of sectors such as power, petrochemicals, fertilisers and other allied gas-based industries," he said.

Amig-Vavasi has signed a "confirmation of intent" with ALNG to secure five million tonnes of LNG annually for 20 years beginning in 2004.

Gordon said the pipeline grid will consist of three networks: the eastern and northern network, the northern and western network and southern network, all interlinking different states.

"Amig-Vavasi is also in talks with potential offtakers of natural gas such as private companies, state electricity boards and cooperatives," he said.