The joint venture will invest over $72mn to set up CBG plants in the country.

By Shardul Sharma

Indian state-owned gas company Gail has signed a term sheet to make an equity investment in compressed biogas (CBG) producer Leafinti Bioenergy, a company operated by TruAlt Bioenergy, Gail announced on December 3. 

TruAlt Bioenergy and Gail’s shareholding in Leafinti Bioenergy would be 51% and 49% respectively. Leafinti will invest over $72mn to set up CBG plants in India. This funding will be sourced through a combination of debt and equity, Gail said. 

The CBG plants are designed to process more than 600mn kg of organic waste annually, including agricultural residue, sugarcane press mud, spent wash from ethanol production, and other decomposable waste. The outcome is projected to yield over 33mn kg of CBG, nearly 20mn kg of solid fermented organic manure, and more than 30mn kg of liquid fermented organic manure each year. 

Each CBG plant unit will boast a daily processing capacity of 10,000 kg, resulting in a daily CBG production of 100,000 kg. The joint venture aims to create a comprehensive ecosystem for CBG production, utilising a variety of waste and biomass sources, aligning with the growing potential of compressed natural gas (CNG).

Rajeev Kumar Singhal, director (business development), Gail said, "CBG has emerged as a viable alternative to imported fossil natural gas. The signing of the Term Sheet is a step in the right direction considering the emphasis on cleaner and greener fuel and country's vision of Atmanirbhar Bharat."

"Through this partnership we aim to create a robust ecosystem for CBG in India allowing for a smooth transition to economical and ecological sources of energy,” Vijay Nirani, managing director, TruAlt Bioenergy said. 

The Indian government recently announced the mandatory blending of CBG in CNG and domestic piped natural gas (PNG) segments. Under the new policy, the compulsory blending obligation will begin at 1% of total CNG and domestic PNG consumption in fiscal 2025-26, gradually increasing to 5% by fiscal 2028-29. 

The government and industry experts believe that the new policy is expected to provide a boost to the CBG sector and help the country cut reliance on costly LNG imports.


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