Rourkela Steel Plant Signs PNG Supply Deal with GAIL, Plans Full Fuel Transition in 3 Months

Rourkela Steel Plant (RSP), the Odisha-based unit of Steel Authority of India Ltd. (SAIL), has entered into a 5-year agreement with GAIL for the supply of piped natural gas (PNG), as per news reports.  

The agreement comes at a time when disruptions in global fuel supply chains, linked to the West Asia conflict, have affected the availability of propane used in industrial operations. 

As part of the arrangement, GAIL will lay the necessary pipeline infrastructure to supply natural gas to the steel plant.  

Shift Away from Propane 

The plant currently uses around 180 to 200 tonnes of propane every month. However, supply constraints in recent months have prompted RSP to look for alternative fuel sources. 

According to reports citing plant officials, the transition to PNG is expected to be completed within the next 3 months.  

The switch is also expected to reduce the plant's dependence on imported propane and provide a more predictable fuel supply for day-to-day operations. 

Steps Taken During Supply Constraints 

The agreement follows a series of measures taken by RSP to manage propane shortages. Earlier, the plant introduced acetylene for slab-cutting operations in Steel Melting Shop-II to avoid interruptions in production. 

It also modified submerged entry nozzle (SEN) heating systems at Casters I, II and III by replacing propane with mixed gas.  

The changes were carried out using in-house resources and were aimed at reducing fuel consumption without affecting production activities. 

Industrial Gas Operations 

Industrial gases continue to play a key role in steelmaking operations at RSP. Oxygen, nitrogen, and argon are used across converters, continuous casting units, cutting operations, and utility services. Some gases are consumed within the plant, while surplus volumes are sold externally. 

During FY26, RSP sold 712 tonnes of liquid argon, generating revenue of about ₹3.62 crore. It also sold 419 tonnes of liquid nitrogen, earning nearly ₹11.75 lakh. 

Read More: Infrastructure Projects Worth ₹6.01 Lakh Crore Added in Q4 FY26, Nearly 69% Linked to Highways! 

Conclusion 

The agreement with GAIL comes as RSP seeks to secure an alternative fuel source amid supply uncertainties. The planned shift to PNG is to support uninterrupted operations while reducing dependence on propane in the coming months. 

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