VALUE BEYOND BUSINESS

Sustainability Report 2010-11 VALUE BEYOND BUSINESS

Creating value for business and beyond business forms the ethos of the way we work. In addition to maximising the business value in financial terms, GAIL has always strived for providing value beyond business in economic, environment and social aspect. Since inception in 1984, GAIL has created value through its business by contributing significantly to India’s gas infrastructure and posting a remarkable business growth year on year. We started with an equity of INR 8,450 million that has grown multi-fold to about INR 590,000 million in last 27 years. Alongside our endeavors in ensuring sound value creation through our business, we focus our efforts in creating value beyond business through our interventions in various aspects of our triple bottom-line, whether it is improving efficiencies in our operations, developing the communities around us, or taking initiatives that reduce our impact on the environment. Our first sustainability report, ‘Value Beyond Business’, is an account of our activities, efforts and plans to infuse sustainability into our business to create value that benefit realms beyond business.

MMSCMD+ reduction in 170 Gas Transmission capacity 12 % NOx emissions

of renewable goods and services energy procured from generated suppliers located in through solar 87% India 31,74 9 GJ and wind projects

increase in total growth in turnover training provided in this year 22% to workforce 30%

GJ of energy E&P / CBM blocks saved through 28 690,000 efficiency initiatives

2 growth in PAT 7,948 tCO e in this year of GHG emissions reduced 14 % through energy efficiency initiatives CONTENTS

Vision & Mission 01

About the Report 02

Chairman and Managing Director’s Message 03

Our Sustainability Approach 05

GAIL - Revisiting the journey 08

Governing the Way We Operate 22

Enhancing the Trust of Our Stakeholders 28

Materiality 32

Our Corporate Strategy 36

Creating Sustainable Economic Value 38

Managing Our Environmental Footprint 42

Creating A Better Workplace 48

Building Value For Our Customers 56

Contributing To Community Development 60

Assurance Statement 68

Glossary 70

GRI Content Index 72

UNGC / IPIECA Reference 78

The Year Ahead 79 VISION & MISSION

Vision Be the leading company in natural gas and beyond, with global focus, committed to customer care, value creation for all stakeholders and environmental responsibility. Mission

To accelerate and optimise the effective and economic use of natural gas and its fractions to the benefit of national economy.

GAIL’s Vision Elements

Leading Company Be the undisputed leader in the Natural Gas market in India and a significant player in the global natural gas industry, by growing aggressively while maintaining the highest level of operating standards. 01 Natural Gas and Beyond Focus on all aspects of the Natural Gas value chain and beyond including exploration, production, transmission, marketing, extraction, processing, distribution, utilisation including petrochemicals, power, Natural Gas related infrastructure, products and services. Global Focus Create and strengthen significant global presence to pursue strategic, attractive opportunities that leverage GAIL’s capabilities while effectively managing business risks. Customer Care Anticipate and exceed customer expectations through the provision of highest quality infrastructure, products and services. Value Creation for All Stakeholders GAIL will create superior value for all stakeholders including shareholders, customers, employees, business partners, surrounding communities and the nation. Environmental Responsibility GAIL is committed to operational excellence in all we do with a focus on continuous efforts to improve environmental performance for ourselves and our customers and will be sensitive to the needs of the environment in all our actions. ABOUT THIS REPORT

We embark on our Sustainability account for our sustainability developments; most of which are Reporting journey with the theme performance. This performance is beyond our control or cannot be “Value Beyond Business” which based on the data and information predicted by us. While we will has been the guiding principle of collected and collated from strive to achieve progress on GAIL since inception. This report primary sources across our these, we cannot ensure a depicts our sustainability operations. Further, wherever desirable outcome in all cases. performance for the period 01 required, we have used This report is based on Global April 2010 to 31 March 2011. It assumptions, standard equations Reporting Initiative’s G3 guidelines covers our gas processing units at and calculation methodologies for on sustainability reporting. A Gandhar, Pata, Vaghodia, Vijaipur, data estimation and quantification. detailed table showing reference and Usar; petrochemicals unit at We have used an average USD to to reported GRI indicators has Pata, Natural Gas compressor INR exchange rate of 45.57 in this been presented on pages 72-77 of stations at Hazira, Vijaipur, report. Certain information this report. The report is also Vaghodia, Jhabua, Khera and included in this report refers to aligned with the International Dibiyapur; LPG pumping our future plans and intentions, in Petroleum Industry Environmental /receiving stations at Loni, order to present a holistic account Conservation Association Mansarampura, Nasirabad, Abu of our sustainability activities. This (IPIECA) and the American Road, Samakhiali, Jamnagar, Vizag information relates to our strategy, Petroleum Institute’s (API) Oil and and Cherlapally; and regional operations, performance goals and Gas Industry Guidance on pipeline offices at NCR, Agra, targets, business plans, research & Voluntary Sustainability Reporting Baroda, Mumbai and Rajahmundry. development and investments in (2005). This report does not cover the the countries, sectors or markets sustainability performance of our where we operate. By their We engaged KPMG to provide JVs, subsidiaries, and other sub-nature, such information advisory services for developing upstream or downstream entities involves a certain degree of this report and Emergent 02 in the supply chain. uncertainty as the end result is Ventures India Pvt. Ltd. to provide dependent on future market independent external assurance We relied on our internal systems conditions, geo-political on the report. and management processes to

GAIL Corporate Office, New Delhi CHAIRMAN & MANAGING DIRECTORS’S MESSAGE

apprehend that together with China, it may take two planet Earths just to sustain the booming economies of India and China, if the business-as-usual scenario continues. Fortunately, in India, concept of “sustainability” has always been an intrinsic part of our way of life, which has been reflected even in our ancient scripts. Efficient and innovative uses of natural resources, re-cycling and re-use have always been an integral part of our ethos. As a clean energy company that promotes usage of natural gas, Dear Stakeholders, GAIL is able to contribute in a It is a pleasure to present GAIL humble way to the cause of (India) Limited’s first Sustainability sustainability. Natural gas is fast Report. Being India’s premier emerging as the preferred fuel and natural gas company for over 25 in recent years, its consumption in years, we recognize that our India has increased substantially. maiden Sustainability Report was Clearly, natural gas will be playing 03 indeed overdue but our an increasingly important role in As a clean energy commitment to the concept of securing a sustainable energy “ sustainability has always been future for India and GAIL will company that embedded in our systems, continue to play its role in energy promotes usage of processes and activities. security for India. natural gas, GAIL is We are operating in a vast country, Together with India’s growth whose economy is booming and at story, GAIL’s surging growth is able to contribute in the same time, the benefits of receiving global attention in the a humble way to the which are yet to be distributed gas-utility space. At the same time, equitably. A vast majority of our we are keenly aware of our cause of people still do not even have responsibility to fully integrate sustainability access to any form of commercial environmental and social ” energy. Even today, more than considerations into our growth 400 million of our people do not strategies. Taking cognizance of have access to electricity. The this, our Strategic Plan recently aspirations of more than 1,200 prepared for this decade, million people, with more than envisages sustainable growth 800 million of our population across the gas value chain for the under the age of 30, are driving company and also aims to take sweeping social and economic steps beyond natural gas by changes in the country. This is tapping emerging potential in posing a huge challenge not only renewable power from wind solar, to India, but is also causing ripple unconventional energy sources effects world-wide. Some even like Shale gas and coal gasification.. For promoting a cleaner and preparedness and performance of sustainable economic the company. In our efforts to development in India, Gas Pipeline build a progressive society, GAIL infrastructure development is has been allocating 2% of its PAT crucial. GAIL’s vast gas pipeline of previous financial year for transmission network of more Corporate Social Responsibility than 9,000 kms and its (CSR) projects. This commitment implementation of on-going new was around USD15 million during pipeline projects at an investment financial year 2010-11. of over INR.250,000 Million would Being a Public Sector Enterprise, soon result in a pan-Indian achievement of commercial goals network of about 14,500 kms. by GAIL has always been in This shall become the arterial harmony with the People and infrastructural linkage to transport Planet aspects of Sustainability. At gas from source to customers and the same time, we realize that this it will also in turn, spur first sustainability disclosure of development of City Gas GAIL will provide us with new Distribution (CGD) projects in insights into growing responsibly many cities and towns, thereby as well as better presenting our “Achievement of laying the foundation of sustainable credentials to the outside world. commercial goals by urban development in India. To give greater momentum to While pursuing our business goals, business sustainability in GAIL, we GAIL has always we always strive not only to have set up a Board Level been in harmony sub-committee in the year ensure compliance to applicable with the People and regulations but also aim to set 2011-2012. This sub-committee is 04 ourselves new benchmarks in chaired by an Independent Planet Director to formulate and oversee ” terms of operational performance sustainability strategy and in the industry. We are also going initiatives. A Sustainability Policy is to expand our Carbon being developed to implement foot-printing initiative to a greater these initiatives in sync with the number of GAIL installations as overall business strategy. part of the Natural Gas STAR Program of the U.S. EPA under To conclude, I would like to thank Global Methane Initiative. For our stakeholders for their developing new sources of energy continued trust and support. We and to deliver energy efficiently, remain committed to further we have brought greater focus improve the practice of and outlays for R&D in GAIL. We sustainability in GAIL to better adopt processes that help to meet your expectations. conduct business in a fair and With best wishes, transparent manner with minimal impact on natural resources. Ensuring health and safety of workforce and the communities near our operations is a high priority. For this reason, we have a (B.C. Tripathi) Health, Safety & Environment Chairman and Sub-Committee of the Board of Managing Director Directors to review the HSE OUR SUSTAINABILITY APPROACH

Accountability, transparency and sustainability will be the deciding factors that will boost our market value, give us a competitive advantage and guarantee a secure future for GAIL. Earlier as a part of our 2012 strategy and now as a part of our forthcoming 2020 strategy, sustainability has been an integral part of GAIL’s business processes. As we have progressed, we have realized the need for further promulgating sustainability at GAIL. Considering what we do for our operations and stakeholders, today; and what we have planned for tomorrow; it is important for us to translate our sustainability aspirations in to effective actions for creation of shared value. Our Directors are responsible for managing these aspirations and driving them in to the most important aspects of GAIL’s business – projects, human resources, marketing, finance and business development. Together, they have created a roadmap towards creating sustainable business processes at GAIL.

05

From left: S Venkatraman, Prabhat Singh, B C Tripathi, S L Raina, P K Jain, R D Goyal

While we take pride in our designed to enhance energy environment and the society. dominant market position in the efficiency in operations. We Our top position in Platts Top Natural Gas industry and strive to continuously seek opportunities 250 Energy Company rankings maintain it, we are committed to in waste recycling and reuse and and other recognitions and mitigate environmental impacts of also improving water availability accolades from various Indian our operations as well. Our by rainwater harvesting and and International bodies such as environmental mission includes other measures. We are also National Safety Council, British optimizing energy, material and exploring alternate energy Safety Council, Greentech, OISD, water consumption, mitigating sources including solar and wind TERI, etc highlight our all round impacts on climate change and air power to meet the growing performance and leadership emissions, ensuring sensitivity energy needs of the country. At position in the global energy towards biodiversity and GAIL, our constant focus is on industry. managing environmentally sound achieving operational operations. Our operation and excellence with due attention R D Goyal maintenance procedures are to the betterment of Director (Projects) It is our firm belief that human development philosophy adopts Our natural resources have an resources are our most important a comprehensive framework intrinsic potential of being asset and the best source of creating comprising experiential learning sustainable with controlled a competitive edge. Our HR policies (through job rotations, special anthropogenic interventions. GAIL and people practices are not only assignments, etc), relationship based has consistently made efforts to strategically aligned to business goals learning (such as mentoring, create a system which resonates but also aimed towards sustaining informal feedback from seniors, with the natural harmonics of our the motivational level of our etc.), formal learnings (through environment. Thereby, we remain employees. The HR Directorate specialized trainings) and leadership committed to increasing the use of Natural Gas, which is a inter-alia focuses on the following development. A major thrust is source of energy with high aspects: given on providing career opportunities for each individual as calorie power, little contamination and a relatively Enabling Culture: We endeavour to we take upon our ambitious growth low-carbon fuel. Additionally our develop a vibrant and dynamic plans. culture that enables each individual focus on low-carbon energy to realize his/her full potential. Our Community Development: Our means we continue to explore aim is to instil a sense of commitment towards our other renewable energy sources such as wind and solar. belongingness and pride amongst community is reflected through our the employees. Over the years, we social responsibility programs, A vital aspect of GAIL’s business is have built a supportive framework carefully identified through a diligent to make products that create value by means of progressive policies and process of need identification for the company and its best of HR practices and have and assessment exercise at the stakeholders. In this context, focused towards developing a safe grass root level. Our programs innovative measures designed to workplace and healthier employees. are identified across seven broad improve the efficiency of It has been our endeavour to ‘thrust areas’ - Community processes and satisfaction of the create a workplace which Development, Infrastructure, Water needs detected in the different encourages a collaborative, & sanitation, Literacy Enhancement, market segments; are regularly 06 caring, open and socio-friendly Educational Aids, Environment carried out in a systematic and work environment. We promote Protection and Health. We have timely manner. We organize regular interactive meets with our diversity and inclusion at workplace constituted a CSR Board consumers, suppliers and vendors by giving equal opportunities to all, Sub-Committee to enhance governance of our social to map and address their irrespective of gender, religion, expectations and concerns. We caste and community. Our inclusion performance at the highest level. Under the CSR Sub-Committee, use these meets to educate our policies give special emphasis to customers and general public and differently-abled employees. We are we have constituted a cross-functional committee at make them aware of the various keen supporters of the UNGC Corporate Office at senior-most uses of natural gas and various principles and look forward to level to evaluate each measures that can be adopted become a signatory to UNGC’s while handling our products. Our recommendation from the Work mandate next year. Through our approach towards enhancing Centres. At each Work Centre policies and practices on ethical product responsibility and also, recommendations are made by behaviour and good conduct, we improving the downstream supply a cross-functional committee of ensure that our operations are free chain is based on listening to executives at middle or senior from any risks involving freedom of customers’ concerns. Further, we levels. expression in professional matters, also seek to anticipate market child labour, forced labour or It is our commitment to continue needs and offer products with discrimination of any kind. to invest in all spheres of people better performance and lower development and society we environmental impact. Our aim is People Development: We hold a to make products that are belong to, in order to achieve promise to continuously develop good to the nation, society and sustainable development. our people so that they have an the environment and are enriching and fulfilling employment S L Raina compliant to all relevant product experience. Our people Director (HR) and marketing related regulations. OUR SUSTAINABILITY APPROACH

GAIL is conscious of the fact that During the year, GAIL contributed The biggest challenge facing oil & its progress and growth impacts to the national gas infrastructure gas companies across the globe is not just the long-term prospects of to increase the pipeline network to ensure reliable, safe and the company, but the society and across the country and look affordable fuel supplies to meet the nation as a whole. Its ultimate forward to creating a pipeline the ever-increasing energy goal is to assume a leadership network of 14,500 km by the demands without compromising position as a transparent and next year. We have also increased the environment and ensuring responsible corporate in the our participation in upstream social well-being at the same time. markets we operate. We hope operations through our JVs, The success of these companies that the wealth created as a result subsidiaries and have undertaken would essentially rest upon their of development will not only strategic investments to ensure ability to adapt their business power the business and the uninterrupted availability of gas. models to the new global industry but would also be Our emphasis on health and safety socio-economic scenarios that reinvested back for the supported by a strong governance recognize the importance of conservation and enrichment of mechanism driven at the Board low-carbon energy sources and environment. level has been effective in societal balance. Therefore it is in achieving a high safety index the better interest of oil & gas Prabhat Singh across operations. We continue to companies to foster strategies that Director (Marketing) use external audits and internal will work towards stabilization of knowledge-sharing to improve our the three bottom-lines: economic, safety performance. We have environmental and social. increased our focus on research & development and are currently in GAIL is a market leader in the the process of formulating a policy gas utility business in Asia. We on our R&D activities. We have achieved a turnover of INR 07 undertaken important projects in 32,4590 million and a profit after hydrogen storage, use of land-fill tax of INR 35,610 million in FY gas, coal gasification and 2010-11. This was achieved due to development of new polymer increase in Natural Gas and Liquid grades. With breakthrough in Hydrocarbon sales. While we these projects alongside expansion continue to focus on our core of our pipeline network, we look business strength, new areas of forward to a healthy economic interest in terms of diversification growth in the near future. within the oil and gas value chain and investments in renewable energy sources are emerging fast. S Venkatraman We have seen a robust economic Director (BD) growth in the past few years and perceive this as an opportunity to share the fruits of our success for the betterment of our nation and communities. Our approach has special emphasis on providing adequate economic support to break barriers for a positive change and common good. P K Jain Director (Finance) GAIL - REVISITING THE JOURNEY

Key facts about GAIL: • About 3/4th of Natural Gas transmitted in India through pipelines • More than half of Natural Gas sold in India • LPG produced for every 10th cylinder of the country • Pipeline transmission of around 1/4th of country’s total LPG • Gas supply for about half of country’s fertilizer produced • Gas supply for about half of country’s gas-based power generation • Operating more than 2/3rd of country’s CNG stations through JVs • Jamnagar-Loni pipeline: World’s longest exclusive LPG pipeline • 74% market share in gas transmission GAIL - REVISITING THE JOURNEY

India had negligible Natural Gas increased quite sharply. During The commissioning of HVJ production at the time of that time, a number of pipeline, the most vital part of independence. From that time to government committees were India’s gas transmission present day, the country has formed to prepare plans for infrastructure, is one of the most progressed in its gas production, Natural Gas utilization in India. important milestones in GAIL’s which has boosted the total Recognizing the importance of history. The proposal for laying Natural Gas production to 50,240 Natural Gas and to establish this pipeline to connect some of million cubic meters (MCM) by FY transmission and distribution country’s biggest fertilizer plants 2009-101. Set up by the facilities in the country, the and gas-based power plants was Government of India in 1984 as a Government formed GAIL with approved in early 1984. The entire principal gas transmission and the following primary objectives: project included establishment of marketing company, we have four compressor stations evolved into a major integrated • To augment and set up en-route, cathodic protection gas company with a global infrastructure for utilization of system for corrosion protection, presence across the Natural Gas Natural Gas and tele-supervisory and value chain. We have come a long • To transport, treat, fractionate, telecommunication systems to way from commissioning the purify and market Natural Gas maintain the safety and control the Hazira-Vijaipur-Jagdishpur (HVJ) fractions pipeline operations. GAIL took pipeline in 1987, to presently • To formulate plans for proper utmost care and operational owning and operating Natural Gas utilization of Natural Gas precision while laying the pipeline, infrastructure across many states fractions in close coordination safely traversing 204 canal in India, by continuously with Government and crossings, 241 road crossings, 24 augmenting our pipeline networks concerned agencies including railway crossings and 14 forest and facilities. industrial users crossings. The pipe laying work • To plan, design and construct was completed by June, 1987 and 09 The 1980s - A remarkable pipelines, systems and related energized by end of July, 1987. In beginning facilities for collection, its initial years, the HVJ (erstwhile Though Natural Gas was treatment, fractionation and HBJ) pipeline provided Natural produced and utilized in India marketing of Natural Gas Gas to major fertilizer and since the turn of the 20th century, fractions. gas-based power plants in the contribution of Natural Gas in • To promote research and northern and western India. development in Natural Gas the overall energy consumption 1 remained small. In mid 1970s, the transmission, treatment and Annual Report for FY 09-10 – Ministry of Petroleum and Natural Gas (MoP&NG), price of petroleum products processing Government Of India

HBJ Gas Pipeline, the foundation of India’s Gas Infrastructure The 1990s – Consolidation and diversification This was a period of consolidation and augmentation of our pipeline network. In May 1992, ONGC transferred all gas pipelines and marketing functions relating to Natural Gas to GAIL. During early 1990s, GAIL consolidated its network by establishing distribution network around Delhi, Gujarat, Maharashtra, and Andhra Pradesh. Gas and LPG transmission - In March 1994, Government accorded approval to the HVJ The first step in Petrochemicals, Pata up-gradation project at a total cost of INR 23,760 million towards LPG and propane. The LPG plant commenced its CGD operations in enhancement of the pipeline flow at Vijaipur was commissioned in Mumbai through a JV with British capacity from the existing 18.2 two phases in 1990-91 and Gas named as Mahanagar Gas MMSCMD to 33 MMSCMD by 1991-92. In the year 1993-94, Limited in FY 1994-95. increasing capacities of existing Government accorded approval to Subsequently, GAIL started the compressor stations at Hazira and GAIL to market propane in India. CGD operation in Delhi for the Jhabua and setting up of two new In the following years, GAIL also supply of CNG/PNG to domestic, compressor stations at Vaghodia set up other LPG plants at transport and commercial and Khera together with laying of Vaghodia, Lakwa and Usar to consumers through a JV with 505 km pipeline between Vijaipur augment gas processing facilities. BPCL and Government of 10 and Dadri. In LPG transmission, National Capital Territory of Delhi GAIL launched the construction Petrochemicals - After elaborate named as Indraprastha Gas activities for the world’s longest feasibility studies and review of Limited in 1998. available technologies, 1269 km. Jamnagar – Loni Exploration and production - Government awarded the Letter exclusive LPG pipeline in October Considering the need for of Intent for setting up a gas 1999 at a cost of INR 12,400 increasing the supply of primary million. While GAIL took several cracker unit in September 1989. energy resources, GAIL initiated projects for augmentation of By September 1991, GAIL had various projects for increasing the pipeline network, there was a acquired 215 hectares of land for supply of primary energy conscious effort towards UP Petrochemicals Complex and resources in 1995-96. By mid improving the environment. In late had selected the technology for 1996, GAIL planned to embark on 1990s, MoP&NG allocated 0.6 gas cracker and sweetening plant. a Coal-Bed Methane exploration MMSCMD of Natural Gas for The Complex was finally and utilization programme after supply to industries in Agra and commissioned in March 1999 at a resource evaluation and Firozabad in order to improve the cost of INR 24,040 million with a completion of techno-economic environment and to protect the design capacity of 300,000 tons of studies. By mid 1997, GAIL had Taj Mahal, one of the Seven ethylene to produce 260,000 tons begun discussions with ONGC for Wonders of the World, from of HDPE and LLDPE. the possibility of joint operation in pollution. Gujarat area for undertaking initial City Gas Distribution - GAIL had assessment of CBM resources by Gas processing - While gas been entrusted the responsibility utilizing abandoned and ceased transmission formed the core of for setting up the infrastructure wells in oil and gas fields. During GAIL’s business towards the end for use of CNG in the Transport 1999-2000, GAIL entered into an of the 1980s, GAIL set up its gas Sector in Mumbai, Delhi and MoU with Government of processing facilities at Vijaipur for Vadodara. GAIL established Rajasthan for studying the extracting propane and butane Compressor Stations and Retail feasibility of in-situ lignite fractions from rich gas to produce Outlets in all the three cities. GAIL gasification. GAIL - REVISITING THE JOURNEY

The 2000s – establishing Petrochemicals - GAIL undertook from September 6, 2005, which leadership major de-bottlenecking of was discovered in September downstream plants thus resulting 2004. GAIL holds 50 percent This period marked GAIL’s in increase in production capacity participating interest in the block. endeavors in exploring new from 260,000 TPA to 300,000 business opportunities, whilst TPA in 2005. It also enhanced its City gas distribution - GAIL establishing leadership in its ethylene production capacity from expanded its city gas distribution businesses. 300,000 TPA to 400,000 TPA by business by spreading its pipeline network in various cities, including LPG and Gas transmission - The addition of new cracker furnace in FY 2006-07. Kanpur, Agra, Lucknow, Pune and Jamnagar – Loni LPG pipeline, cities in Andhra Pradesh and world’s longest and India’s first Exploration and production - By Tripura, through eight Joint cross-country LPG pipeline was 2002-03, GAIL had participating Venture companies. GAIL has also commissioned during FY 2000-01. interest in 10 exploration blocks in set up a 100% subsidiary Covering 1269 km, this pipeline consortium with E&P companies company, GAIL Gas Limited passes through the states of like ONGC, OIL, GSPC, Hardy, (GGL) for City Gas Distribution Gujarat, Rajasthan, Haryana, Delhi Gazprom and Daewoo (CGD) and CNG corridor and U.P. The pipeline capacity in International. The portfolio business. GGL was created to take the first phase was 1.7 MMTPA, consisted of 8 NELP and 2 farm-in up distribution and marketing of which was upgraded to 2.5 blocks. The year 2003-04 brought CNG as fuel for vehicles, Piped MMTPA through commencement the first success for GAIL’s E&P Natural Gas for domestic/ of Kandla-Samakhiali linkage in FY activities with gas discovery in A 1 commercial/ industrial purposes 2002-03. The Board of Directors block in Myanmar and discovery of and Auto LPG as fuel for transport approved the project to lay a 600 oil and gas in the Cambay block. vehicles in the various cities of km LPG pipeline from Vizag to GAIL had participating interest in India and abroad. GGL would also 11 Secunderabad in February 2001 at 11 E&P blocks covering an take up investment in and setting an estimated cost of INR 4,900 acreage of over 67,000 sq. km. by up of infrastructure in various million. GAIL completed the 2004-05. For the first time ever, cities of India and along the Vizag-Secunderabad LPG pipeline GAIL started the production of national highways for building in June 2003, designed for a crude oil in its Cambay Oil Basin CNG corridors. maximum throughput of 1.16 MMTPA of LPG from Vizag to Secunderabad. Over the years, GAIL has grown organically by building a network of Natural Gas trunk pipelines covering a length of over 8,600 km and over 2,000 km of LPG pipeline. Towards the end of early 2000s, GAIL transmitted more than 118 MMSCM of gas everyday through its dedicated pipelines, contributing to a 74% market share in gas transmission. Gas processing - With the commencement of operations in LPG plant at Pata in 2000 and Gandhar in 2001, GAIL reached a design production capacity of 1.1 MMT of LPG per annum. LPG transmission through pipeline Today – A leading integrated China, Vietnam, Indonesia, biggest investment in the north- gas company Philippines, Israel and the United east region of the country. This Arab Emirates. During the year, project is expected to give rise to The year 2010-11 saw a we acquired a 17% equity stake in a substantial employment remarkable increase of 30% in a 1.1 MMTPA petrochemical generation both direct as well as our total sales, with 13.5% project implemented by ONGC indirect, and will attract substantial increase in PAT over the last year. Petro Additions Limited at Dahej, investments in setting up of This was a result of our continued Gujarat, India. We are further downstream plastic processing efforts in augmenting our doubling the capacity of our industries in North east. Hon’ble operations and pursuing new petrochemical plant at Pata by Prime Minister of India laid the business opportunities. installing 450,000 TPA Gas foundation stone of the project at Gas and LPG transmission – During Cracker Unit and 400,000 TPA Lepetkata, Dibrugarh, Assam on Downstream Polymer Unit. 9th April, 2007. the year, we successfully These investments will help us in commissioned the 498 km realizing the strong growth that Exploration and Production – Our Vijaipur-Dadri pipeline, 175 km we have envisaged in this business. foray into exploration and Sultanpur-Neemrana pipeline and production business post 88 km Focus Energy pipeline. GAIL is promoting a Joint Venture liberalization of Natural Gas sector With the execution of our Company, Brahmaputra Cracker & in the year 2000 has opened up on-going projects to build Polymer Limited (BCPL), in various opportunities for our cross-country gas pipeline Assam, which has been business and will help GAIL to infrastructure, we plan to augment incorporated as a Central Public match demand with supply of gas our pan-India presence with a Sector Enterprise under Ministry through integration of supply total pipeline network of 15000 of Chemicals & Fertilizers. GAIL is chain. We are currently km in coming years. the main promoter having 70% participating in 27 exploration equity share, with Oil India blocks in Mahanadi, Mumbai, Petrochemicals – Over the years, Limited (OIL), Numaligarh Cambay, Assam-Arakan, Tripura 12 we developed our competencies Refinery Limited (NRL), Govt. of Fold Belt, Krishna Godavari, in petrochemicals to achieve a Assam, each having 10% equity Cauvery and Cauvery Palar basins. 17% market share in India. Apart share. BCPL is setting up a These blocks are in various stages from serving customers in India, 2,80,000 MT per annum polymer of exploration, appraisal and we have grown the customer base plant at an investment of INR development, with hydrocarbon for our petrochemicals products in 89,200 Million. This is the single discoveries in seven E&P blocks.

Gas Cracker Unit at Pata Special Postage Stamp released on Silver Jubilee of GAIL GAIL - REVISITING THE JOURNEY

Pipeline Laying Operation

City Gas Distribution – Our foray in Through our JVs we have also Gujarat, India, for captive city gas distribution has led to established city gas distribution utilization, and are gearing up to increase in the reach of our systems consisting of underground set a 100 MW commercial wind products to retail customers, pipeline distribution network energy project. Apart from wind thereby augmenting consumption inside cities to supply Natural Gas energy generation, we are also exploring opportunities in solar of Natural Gas based products in to consumers for varied power. the form of CNG and PNG, applications. besides strengthening our Renewable Energy - We are Telecom - Started in 2001, GAILTEL: our telecom business 13 presence in downstream strategically looking at lowering has a reach of around 13,000 km operations. At present CNG retail our environmental footprint by of optical fibre cable network outlets of GAIL and its JVs are focusing on renewable energy. We across India, connecting 150 towns available in Delhi, Maharashtra, have successfully commissioned a and cities spanning across 10 Indian Uttar Pradesh, Gujarat, Andhra 4.5 MW wind energy project at states. GAILTEL network is built Pradesh, Tripura, and Madhya Sinoi, Gujarat, India, mainly for largely along our highly secured Pradesh states with more than captive consumption. We are cross-country pipeline corridor 400 CNG retail outlets catering to currently executing another 15 ensuring highly reliable and error approximately 6,80,000 vehicles. MW wind power project in free service to its customers.

A Night View of Gas Processing Facility at Vijaipur, M.P. Creating value beyond GAIL's contribution to gas supply in India in FY 2010-2011 business Sector All India Supply made by % of supply In line with our Vision to create Supply (MMSCMD) GAIL (MMSCMD) made by GAIL value for all stakeholders and fulfill Power 63.59 31.20 49 our environmental responsibility, we have taken various initiatives Fertilisers 38.52 21.29 55 and business decisions over the CGD 13.31 6.07 46 years to ensure our businesses and Sponge Iron 8.03 2.89 36 operations have maximum impact on the economy and our Small Scale Industries 5.34 5.34 100 stakeholders. Others (Refineries, Petrochemicals etc.) 24.45 10.12 41 Contribution to India’s energy Internal Consumption/Shrinkage 8.87 6.32 71 requirements - India is the fourth Total Supply 162.11 83.23 51 largest energy consumer in the world, with gas constituting up to 2.5 million tons of steel be utilized until the 1980s due to around 11% of India’s primary 2 energy consumption Out of the pipes from this expansion . technological and economic feasibility. With commencement of 162.11 MMSCMD gas marketed in Substituting road transportation of the country in FY 2010-11, GAIL GAIL’s operations and growth LPG - With laying of exclusive over the years, GAIL has marketed around 83.23 pipelines for LPG transmission in MMSCMD, thus accounting for significantly contributed towards various parts of the country, GAIL reducing flaring of gas from 5.6% of the primary energy has contributed to replace the consumption. Currently, more exploration and production mode of transportation by road activities. From 3,445 million cu.m than half of India’s Natural Gas is required to deliver LPG from traded by GAIL, operating more of gas flaring in India at the time of production facilities to various commissioning of HVJ pipeline in than 2/3rd of country’s CNG customers. During FY 10-11, our 1987-88, gas flaring in India has stations through JVs, producing pipelines led to reduction of GHG reduced to 993 million cu.m in FY 14 25% of India’s total poly-ethylene emissions by 9,656 tCO e by 2 2010-113. and producing LPG for every 10th shifting of LPG transport from cylinder in the country. road to pipeline.

Developing the high-grade steel Reducing GHG emissions from 2 industry - During the nascent years Source: Ministry of Steel website and flaring - India’s exploration and Internal informations. of GAIL’s operations, steel pipes production activities involved 3Source: “Basic Statistics on Indian Petroleum were primarily imported from flaring of natural gas that could not and Natural Gas 2009-10” by MoPNG foreign suppliers, with HVJ constructed using completely Gas flaring over the years (million m3) 5000 imported pipes along its length at that time due to unavailability of 4500 Gross gas production Total flaring suppliers of special grade steel in 4000 India. Since 1985 during construction of HVJ pipeline to 3500 now, GAIL’s operations have 3000 contributed to the development of Indian steel pipe manufacturing 2500 industry which has come a long 2000 way, with over ten suppliers 1500 currently providing X-70 steel grade pipes in India, further 1000 exporting 30% of their total 500 output. With over 10,000 km of pipelines planned to be 0 constructed during the period 2011-15, the industry now

observes huge demand creation of 1987-88 1989-90 1991-92 1993-94 1995-96 1997-98 1999-00 2001-02 2003-04 2005-06 2007-08 2009-10

OUR BUSINESSES, PRODUCTS & BRANDS

Industrial & domestic Ratnagiri Gas consumers Private Limited Power

Industrial and Consumers

City Gas Distribution

17 LPG transmission

Exploration and Production

Operational units 27 E&P blocks 13000 km of GAIL (25 in India, 2 overseas) OFC network China Gas through cross Global Total production country Energy 420 TMT (FY 10-11) pipelines Holdings (5681 km) Limited Key products/services and GAIL Global Gas from Imports, Gas state/national (Singapore) from Indigenous sources highway routes Pte Limited (7346 km). and Power (RGPPL) Gas Processing Units

Operational units 7 (Vijaipur(2), Auraiya Vaghodia,Usar, Lakwa, Domestic Gandhar)

Total production 301 TMT (FY 10)

Key products/services Pentane, propane, SBP Gas transmission: 6 NG solvents, naphtha compressor Stations (117.91 MMSCMD in FY 10-11) 18 (3337 TMT in FY 10-11)

Petrochemicals

Operational units LPG Pumping / 1 (Pata) Receiving station (9nos) Total production 420 TMT (FY 10-11) Industrial & domestic Key products/services consumers HDPE/LLDPE pellets, LP flakes, PE shreds GAIL’S PAN INDIA PRESENCE

19 20 AWARDS AND ACCOLADES

10th ICSI National Award for Excellence in Corporate Governance 2010 - Certificate of Recognition for Excellence in Corporate Governance Institute of Company Secretaries of India Ranked No.1 Company among gas utilities by Platts Top 250 Global Ranking of Energy Companies 21 Corporate Award for Gas-Processing, Transmission, and Marketing Dun & Bradstreet – Rolta Greentech Environment Excellence (Gold) Award 2010 Pata, Vijaipur, Vaghodia, Jhabua, Hazira, NCR and Mumbai Greentech Foundation Asia’s Best Employer – Best HR strategy in line with Business World HRD Congress International Safety Award for KG Basin and NCR units British Safety Council (UK) ‘Managing India Award’ for the outstanding PSU All India Management Association (AIMA) Customer Responsiveness Award, 2010 in Manufacturing Sector Economic Times & Avaya Global Connect

Oil Industry Safety Award G ail( Indi (14th time for our HVJ pipeline, 7th time for Vijaipur unit) a)Lt # 1 d Gas OISD Utilit iesC ompa 20 ny in Safety Innovation Award – Agra, Khera, Lakwa, Nasirabad 10 Asia Institute of Engineers Delhi State Centre Sarvashrestha Award – MP Chapter for Vijaipur National Safety Council GOVERNING THE WAY WE OPERATE

Our governance framework is founded on the principles of ethical conduct, transparency, professionalism and accountability. We are also closely guided by government-mandated frameworks for developing our strategy and associated actions, further reinforcing our commitment towards responsible business practices. GOVERNING THE WAY WE OPERATE

We have a range of company-wide through various Board policies that enhance control over Committees4. These committees, various aspects of GAIL’s business apart from expediting business performance and work discipline. decisions, also assist the Board in These policies range from devising governing sustainability standard procedures for performance of the company. To advertisement and communication ensure a strong focus on • HR to laying stringent codes and sustainability, we have constituted • HRD procedures for operation and committees to look into various • Training maintenance. Over the last two aspects of sustainability, including • CSR years, we have reviewed major health, safety and environment, • Legal policies like HR, CSR and HSE in employee discipline and corporate • Security line with changing business social responsibility (CSR). • RTI requirements and leading practices • Co-ordination across the industry. GAIL(India) 4Our Annual Report details out the Limited is a Navratna, Central functions and responsibilities of each Board Public Sector Enterprise listed Committee. Please refer to the following line to access DIRECTOR with Bombay Stock Exchange our latest Annual Report - (HR) (BSE), National Stock Exchange http://gailonline.com/final_site/pdf/GAIL_A (NSE) and its GDR is also listed R_2010_11.pdf with London Stock Exchange. It is one of the constituents of benchmark index NIFTY and SENSEX of NSE and BSE • Project Pipeline respectively. Government of India Petrochemical Plant DIRECTOR 23 is the majority shareholder with NGMC & (PROJECTS) 57.35% equity stake in the • O&M Pipeline Network company. For the shareholding pattern refer to page 51 of Gas Processing Units Corporate Governance section of Petrochemical Plant Pata our annual report FY 2010-11. • GAILTEL & Telemetry • Contracts & Procurements Leadership at GAIL • Business Information System The Board of Directors supervises • Corporate Affairs our corporate strategy and overall performance of the company. Their rational decision-making and able leadership has been an important contributor to our success over the years. As on 31st Board Structure March 2011, there were 14 Directors on the Board, Functional Govt. Independent comprising six Whole-Time Directors Nominee Directors Directors Directors including the Chairman • B.C. Tripathi • Sudhir Bhargava • Prof. A.Q. Contractor and Managing Director, two • R.D. Goyal • Apurva Chandra • Mahesh Shah part-time Directors nominated by • S.L. Raina • R.M. Sethi Government of India, and six • Prabhat Singh • Dr. Vinayshil Gautam part-time Independent Directors. • S. Venkatraman • Arun Agarwal • P.K. Jain • Dr. U.K. Sen Our Board drives the company’s strategy and specific actions Functional Structure

Joint Ventures • BD M&A & Diversifiction International • Corporate Planning • Project Development • E&P • R&D • TQM DIRECTOR • HSE (BD)

Sub-Committees of the Board 01 Audit Committee Prof. A.Q. Contractor (Chairman) - Mahesh Shah Arun Agarwal 02 Business Development & Marketing Committee R.M. Sethi (Chairman) - Prabhat Singh - S. Venkatraman CMD P.K. Jain - Apurva Chandra - Arun Agarwal DIRECTOR 03 Corporate Social Responsibility Committee • Vigilance (FINANCE) • Company B.C. Tripathi (Chairman) - S.L. Raina - Apurva Chandra Prof. A.Q. Contractor Secretary 04 Employee Disciplinary Committee • Internal Audit B.C. Tripathi (Chairman) - R.D. Goyal - S.L. Raina Dr. Vinayshil Gautam 24 • Accounts 05 Empowered C&P Committee B.C. Tripathi (Chairman) - R.D. Goyal - S.L. Raina • Mgmt. Accounting Prabhat Singh - S. Venkatraman - P.K. Jain • Taxation 06 Ethics Committee • Project Evaluation Mahesh Shah (Chairman) - Prof. A.Q. Contractor • Treasury & Banking Arun Agarwal • Accounts Receivable/ 07 HR Committee Accounts Payable B.C. Tripathi (Chairman) - R.D. Goyal - Arun Agarwal S.L. Raina - Prabhat Singh - S. Venkatraman - P.K. Jain DIRECTOR & Insurance Mahesh Shah - Dr. Vinayshil Gautam (MARKETING) • Costing 08 HSE Committee Prof. A.Q. Contractor (Chairman) - R.D. Goyal S. Venkatraman 09 Project Appraisal Committee B.C. Tripathi (Chairman) - P.K. Jain - Apurva Chandra • Gas Sourcing Dr. Vinayshil Gautam - Arun Agarwal • Gas Marketing & 10 Remuneration Committee Transmission R.M. Sethi (Chairman) - S.L. Raina - P.K. Jain • Polymer Marketing Prof. A.Q. Contractor - Arun Agarwal • LHC Marketing 11 Shareholders / Investor’s Grievance Committee Mahesh Shah (Chairman) - S.L. Raina - Prabhat Singh • GAIL Gas Limited 12 Share Transfer Committee • City Gas Distribution Executive Director (Finance) / Head of Finance • Pricing Company Secretary / Senior Most Official Company Secretariat • Regulatory Affairs 13 Stakeholders’ Grievance Redressal Committee • RGPPL Prof. A.Q. Contractor (Chairman) - P.K. Jain • Corporate Communication GOVERNING THE WAY WE OPERATE

Managing risk across GAIL Natural Gas) vis-à-vis absence non-compliances & highlighting of additional sourcing for timely corrective action. At GAIL, the accountability and arrangements and meeting • Alignment of decisions to responsibility of risk management increased gas requirement venture into E&P projects in is clearly defined from the Board with the expansion of existing India and abroad by setting up level to individual risk officers. The polymer production capacity. standard of operations and Audit Committee, Corporate-level • Growth of transmission performance with defined risk and site level Risk Steering business affected by tight supply tolerance capacity. Committees, help in overseeing of gas and laying of self-owned risk management activities that are domestic gas pipelines by Governing our sustainability executed by risk owners at site private players. performance and at corporate level. Over the • Increased competition from years, our risk management The Board of Directors supervise new players due to process has evolved to our triple bottom-line de-regulation of market. incorporate innovative methods of performance through • Limited product range resulting risk identification, mitigation and sub-committees dedicated to in threat to market share. awareness generation. This year, relevant sustainability focus areas • Inadequacy of storage space for we identified seven key business like CSR, employee discipline, by-products like MFO, C4 mix risks for GAIL, to be monitored at health, safety and environment. leading to running of the plant corporate and site level. These These committees are responsible at a lesser load. include: for developing annual plans, • Improvement in control approving or nominating initiatives mechanism over compliance • Existing sourcing of Natural Gas to be taken, and monitoring and issues for identifying / RLNG (Re-gasified Liquified reviewing the performance from 25 corporate office of each facility. All our facilities are mandated to report their HSE and CSR performance on a monthly basis. Risk These progress reports are polarization collated, reviewed and discussed • Assigning risk score by the committee members along to each risk by with the Board. All our gas assesing its impact processing and petrochemical and its probablity plant and LPG pipeline systems Risk validation & identification Risk and Natural Gas Compressor mitigation • Identification Stations under operation are ISO managment of • Analysis of key risks 9001, ISO 14001 and OHSAS external & internal factors and development of 18001 certified. We have designed mitigation plans across in context of strategy an Integrated Management System and critical process all critical processes Risk (IMS) based on systemic governance requirements of ISO 9001:2008, • Establishment structure ISO 14001:2004 and OHSAS that cascades across 18001:2007 for all our processes, the corporate level, activities, products and services business units & risk units across locations. These systems enable us to effectively control and manage our performance. CMD and Board of Directors at the Annual General Meeting of GAIL

Driving ethics and adherence to all laws and performance with regard to transparency through regulations. Every designated conflict of interest, fair play, proactive vigilance employee of GAIL has a moral integrity, accountability, obligation to safeguard the transparency in disclosures, We have adopted stringent 26 confidentiality of sensitive compliance, propriety, and measures to uphold ethical information and also ensure that confidentiality. We have set out a conduct across operations, his or her position or knowledge stringent code of ethics for our whether related to contractor about GAIL is not used to gain any internal audit department to performance or employee personal or third party benefit. To behavior. Based on Government of further our commitment towards this extent we have prepared a business ethics. We have also India’s rigorous vigilance Code of Conduct for Prevention activated an online complaint procedures, we have developed of Insider Trading that extends this registration system on our systems and policies that promote responsibility and accountability to corporate website to leverage IT and ensure high standards of ethics all our dealings. and transparency across GAIL’s to address vigilance-related operations. Our “Code of We have set up an Ethics complaints raised by our Conduct” sets out strong Committee under the Board of stakeholders Directors to put more emphasis guidelines for our employees, At GAIL, we have deployed a Bill including the Board members, to on ingraining ethics and Watch System to improve act responsibly in all aspects during transparency as an important processing of vendor bills, increase their tenure at GAIL. element of our governance practices. This committee is transparency for vendors during We endeavor to preserve the chaired by an Independent tracking of payment, and enhance confidentiality of price sensitive Director to ensure its independent trust through independent nature information and prevent misuse of and effective functioning. of the system involved. Similarly, such information by anyone. We Upholding the essence of Clause we have also upgraded our File are committed to transparency 49 of the Listing Agreement and Management System on similar and fairness in dealing with all our Code of Conduct, the Ethics lines to track the movement of stakeholders and in ensuring Committee reviews practices and files within GAIL. GOVERNING THE WAY WE OPERATE

We promote vigilance awareness GAIL endeavours to create an providing a transparent way for through our internal magazine, organization free from corruption vendors to put forth their ‘Jagrook’, which provides and is inclined towards upholding grievances and get them redressed information on proactive vigilance high ethical values. To this end, we in an effective manner. have signed an MoU with and describes several successful Transparency International5 (TI) in While we have taken stringent case studies. This is supported by 2007 for ratification of Integrity measures to curb corruption and appropriate measures to boost Pact Programme in consultation promote transparency in our awareness of our employees and with the CVC to maintain and operations, there were seven cases of corruption reported major vendors towards the need foster ethical and corruption free business environment. This pact is during the year. Necessary action for proactive vigilance and ethics. was taken by the vigilance This year we also observed a also mandatorily signed by vendors / suppliers having high value department, based on the Vigilance Awareness Week from contracts. We have become the outcome of their investigation. In 25 October to 01 November first public sector enterprise to opt four cases we imposed a minor 2010. During this week, banners for audit and 360 degree review of penalty, while remaining three are and posters were displayed across the efficacy of Integrity Pact in various stages of closure. As we move into the next year, we will sites and seminars were conducted Programme by an external agency. This will help us to further continue to undertake similar at major locations. Additionally, we measures to instill high standards have also put efforts to effectively strengthen our procurement practices. GAIL has appointed of anti corruption across our implement RTI Act at GAIL. In this Independent External Monitors operations. regard, during the year, we (IEM) of high repute to lend 5Transparency International is a provided 11 training programs to transparency to our procurement non-government, non-party, and not-for-profit 200 employees on the key procedures. IEMs strengthen our organization of citizens of professional, social, elements and enforcement areas vigilance in contract and industrial or academic experience to promote procurement procedures by transparent and ethical governance and to for this Act. eradicate corruption. 27

On the occasion of Vigilance Awareness Week: (Top Left) Launch of Jagrook Magazine; (Top Right) Awareness March at Vijaipur; (Bottom Left) Pledge Taking Ceremony; (Bottom Right) Awareness March at Jaipur ENHANCING THE TRUST OF OUR STAKEHOLDERS

‘Value creation for all stakeholders’ has always been a part of our vision. We believe in working together with our stakeholders to create long-term value and enhance their trust in our business. Our increased growth is a result of synergies and relationships that we have developed with our stakeholders, over a period of time. ENHANCING THE TRUST OF OUR STAKEHOLDERS

We identify our key stakeholders party to the other, assist in and security, expansion and through their impact on our identifying issues, reducing diversification plans with the business and the value we create misunderstandings, clarifying Ministry and other government for them in return. The concerns priorities, and exploring areas of bodies at regular intervals. During identified by them through various compromise and generating this year, we also engaged in channels and engagement options in an attempt to solve the discussions with Government on mechanisms are vital for our disputes. gas utilization, Natural Gas pooling business continuity. We have and swapping mechanism. defined specific roles and Government of India and The Petroleum and Natural Gas responsibilities of the key regulatory authorities Regulatory Board (PNGRB) plays departments in GAIL to address Being a Central Public Sector an important role in the growth these concerns, monitor them, Enterprise (CPSE), GAIL is directly plans of our pipeline and city gas and ensure that they are distribution infrastructure. One of accountable to the Government of addressed in a timely and efficient its mandates is to protect the India for its performance and manner. We are one of the few interest of consumers by fostering fulfillment of business objectives. companies in India to set up a fair trade and competition The Government plays an focused Board committee to amongst the entities and also to important role in setting out our address grievances of all ensure uninterrupted and annual business objectives. These stakeholders through the adequate supply of natural gas, Stakeholders’ Grievance Redressal objectives are clearly set out as petroleum and petroleum Committee. This committee is part of our MoU with the Ministry, products in the country. We empowered to take decisions on which is mutually discussed and comply with PNGRB guidelines to disputes referred by stakeholders agreed upon at the start of each get approvals for any expansion and resolve them amicably. The financial year. We also engage with projects with respect to committee has been constituted in the Directorate-General of processing, storage, 29 a manner to bring independence in Hydrocarbons (DGH) for our transportation, distribution, its functioning. Disputes or exploration and production marketing and sale of natural gas. concerns, if any, reported by our activities that contribute to the We also actively engage with stakeholders to the Committee nation’s energy security. several regulatory authorities for are resolved through our Additionally, we have regular ensuring compliance to laws & Settlement Advisory Committee. discussions on our financial regulations. Apart from fulfilling The Settlement Advisory performance, gas allocation, gas our regulatory requirements Committee helps in pricing, energy security, project including submitting annual reports communicating views of each planning, vigilance issues, safety and statutory filings as per Listing

High Level Meeting of Parliamentary Standing Committee with GAIL Management Review meeting of GAIL HR Agreement, organizing site requirements is vital for our acquiring the right talent for our inspections and filing compliance current and future business businesses and provide adequate reports to the authorities, we are growth. We engage with our opportunities for them to learn also involved with them for customers through varied and grow in the organization. In developing policies /regulations for mechanisms to gauge dynamic certain facilities located far from Indian oil and gas industry. market conditions and to address cities and towns, we ensure that specific concerns and we provide our employees an Shareholders6 and Investors requirements in a timely manner. engaging atmosphere through our 30 It is important for us to Their key concerns are centered welfare activities and internal understand the priorities of our on quality, availability and pricing communication. We fulfill our shareholders and investors of our products. We have devised commitment towards employee regarding issues on material a customer suggestion scheme and development by providing importance to our business. This re-dressal mechanism module to adequate opportunities to them to enables us to optimize our address customer enquiries and hone their technical and performance to create maximum grievances. Customers are given inter-personal skills. Our annual value for our investors/ easy access to these tools on our performance review program, shareholders. We interact with our corporate website. Our customer employee suggestion schemes, shareholders and investors on satisfaction surveys help us to employee engagement surveys and several business issues at various assess the level of their satisfaction internal review meetings help us in forums including annual general and their key expectations. We identifying and responding to our meetings, investor meetings, etc. organize customer meets and employees’ key concerns. We We share our financial felicitation events to further our support these measures by performance, business outlook relationship with them. Our on-going means of interaction and future business plans with advertising and marketing including internal magazines, them to gain their trust and initiatives are supported by our newsletters and the intranet. We incorporate their perspectives on product brochures, road-shows have also established initiatives to our short and long-term business and campaigns. enhance our relationship with our strategy. employees through our employee Employees recognition awards and schemes Customers Our employees are our most and by organizing celebrations for festivals and cultural events. Our ability to develop products to valuable resource and significant contributors to our success. It is meet changing market demands 6‘Shareholders’ refers to all shareholders and specific customer important that we focus on other than Government of India. ENHANCING THE TRUST OF OUR STAKEHOLDERS

Vendors/contractors concerns. Some of the key objectives of creating shareholder developmental concerns of local value, attracting, retaining and We rely on our vendors, communities around our motivating high quality people, contractors and other business operations include the need for enhancing reputation of all partners to support our operations infrastructure, healthcare facilities, audiences, marshalling through their products and education and generation of stakeholders, support on public services vital for our business. adequate livelihood opportunities. policy issues, creating consumer Therefore, it is our responsibility We interact with our local preferences for product and to guard their business interests communities through meetings including timely payments and services and minimizing the impact with village heads, heads of local making them aware of GAIL’s of any crisis on the company’s self-governments, and through stringent benchmarks on health financial position and business and safety, proactive vigilance and community visits to understand prospects. In the fast-changing quality of service. We organize their needs and take suitable environment of the oil and gas vendor meets and regular business measures to address them. Our sector, which is posing myriad review meetings to address the CSR programs enhance our challenges, we are taking key concerns of vendors. With a relationship with them while measures to communicate firm focus on vigilance, we interact addressing their developmental effectively with our stakeholders with our vendors on our stringent concerns. Our relationship with and maintain optimal visibility as contract and procurement communities is vital with regard to well as brand recall in the procedures throughout the tenure the safety and security of our mind-space of investors and the of their service and through extensive pipeline network. We public base at large. The planned interaction programs as part of interact with them by conducting media / communication strategy Vigilance Awareness Week every meetings to create awareness on comprises a right mix of media year. We monitor contract pipeline security, disaster and interaction and branding progress in a more structured emergency preparedness. opportunities such as press manner, enhancing transparency conferences at headquarters as 31 Media and accountability in our well as work centers on various relationship through the “Bill We have maintained very open developments in the Company, Watch System”. and transparent communication formal and informal media channels with the media, resulting interactions, exclusive interviews Community in a mutually beneficial with print, wire and electronic We actively engage with the relationship. Media media, press releases, communities adjacent to our communication strategies have sponsorships of events, facilities to support their been practiced so as to ensure participation in industry development and address their alignment with the key business exhibitions, etc.

CMD interacting with Media in a Press Conference MATERIALITY

Identifying sustainability issues of critical importance is essential for developing a focused and comprehensive sustainability strategy for GAIL. For this, we institutionalized a robust process for identification of material sustainability issues and challenges for the company and its stakeholders. The intent was to deliberate on sustainability issues that impact us and would drive our growth in the future. MATERIALITY

Our materiality We intend to further refine the process of defining material issues in the coming years and develop a wholesome strategy based on the core sustainability areas that are significant to us and our Identification stakeholders. We have adopted a by key managment two-phase approach towards at facilities defining materiality that takes perspectives of key management 22 10 personnel across our major facilities (including our corporate sustainability + sustainability office) together with review of issues issues challenges specific to the global oil Review of and gas industry. The overall sustainability dossier formed by these perspectives was screened and challenges in the reviewed by the top management oil & gas sector to arrive at the top six material globally issues. While the management perspective helped in identifying business issues in conjunction with space, the importance of natural continued and uninterrupted specific local sustainability issues at gas has grown exponentially in the supply of gas for our business, we the facility level, review of sectoral past few years due to its are also gradually increasing our challenges provided a balance to environmental and economic footprint in LNG and natural gas the process by aligning it with benefits. Being the National Gas trading in the international global trends in the oil and gas Company of India, securing gas markets. 33 sector. supplies in order to meet the Business growth burgeoning gas demand in the Gas sourcing country holds primary importance With infusion of reforms in India’s India is on a path of becoming a for GAIL. We continue to oil and gas sector, the market was developed economy and in order strategically increase our opened for domestic and to continue to grow at this fast investments in exploration and multinational companies, thereby pace, the energy sector would production in India and increasing competition. This has play a vital role. In the energy internationally. In order to ensure increased pressure on our

Offshore Exploration and Production activities Expanding our Gas Pipeline Infrastructure determination process qualified personnel suitably equipped with knowledge, skills, Gas sourcing attitude and a practical exposure to highly specialized jobs. Thus, it Business growth is imperative that we acquire the right talent to fuel our growth and give them the right exposure and Skilled manpower availability opportunity for their overall Review and screening development. Our efforts focus on by GAIL’s recruitment from some of India’s senior managment Customer satisfaction best academic institutions. We also conduct a stringent all India competitive test to give fair and Safety and security transparent opportunities to talent across the country and train them in our high class training facilities Climate change supported by the GTI (GAIL Training Institute). A majority of our operations are located in operating margins adding up to the is moving as envisaged. remote areas where access to stiff challenge we face due to the Additionally, we are developing a basic living amenities is a constraint. To improve retention locking up of capital in our high 2020 strategy to accelerate our and satisfaction amongst our value assets and gas infrastructure. long-term growth with focus on employees, we have taken These conditions have compelled looking beyond conventional us to look for new avenues to fuel consistent investment efforts business opportunities and towards building adequate our business growth. During the associated challenges. financial year, we increased our infrastructure and promoting 34 market penetration through Skilled manpower availability welfare activities. further integration of our natural Customer satisfaction gas value chain and by developing With new technological new improved petrochemical developments in the hydrocarbon Managing customer expectations products. Implementation of new sector and phenomenal expansion is essential to sustain our growth projects and initiatives as per the witnessed by the company, there and market share in India. In this existing 2007-2012 strategic plan is an ever-increasing need to tap regard, it is imperative that we

Training session at GAIL Training Institute, Noida Director Marketing Interacting with Customers and Stockists MATERIALITY

make our pipeline network more safety of public, employees, plants, company, addressing risks and efficient by reaching out to more assets and equipment. HSE opportunities arising from various customers, ensure uninterrupted performance across operations is aspects of climate change is vital supply of gas to customers and be reviewed in every Board meeting. for our business. With India stating able to provide the desired quality To have a focused approach on its willingness towards accepting of gas that suits their HSE issues, we have constituted a legally binding emission reduction requirements. We have a strong separate HSE sub-committee of targets, impending climate change customer relationship Directors at the Board level to related legislations will pose a management approach built into closely monitor the performance challenge to our operations our petrochemical marketing and emergency preparedness of towards increasing energy process. These are being our operations. Our extended efficiency and identifying replicated into the gas marketing approach on health has helped us opportunities for captive use of business to manage customer in working with communities to renewable energy. A major focus expectations better. We have address local health issues arising area emerging from this is our employed the latest technologies from pre-dominant ailments and foray into alternate sources of in our gas management and health risks in the regions where energy that delves into metering system. GAIL has been we operate. development of a strong wind and strongly pursuing gas pooling Security of our people and assets solar energy portfolio in the mechanism. During the year, we is of extreme importance to us. coming years. Our plan to set up have strengthened our efforts in We have stringent security new wind power units and our customer relationship arrangements to handle and active participation in the JNNSM management and have addressed manage any mishaps or untoward (Jawaharlal Nehru National Solar queries raised by customers incidents due to the increasing Mission) will enable us to augment through customer relationship geo-political instability. We have our captive power generation as portals, satisfaction surveys and also invested on trained security well as initiate commercial sale of 35 other means of engagement. staff to ensure seamless power from renewable sources. operations. Additionally, we also expect a Safety and security higher demand of natural gas Climate Change Health and safety risk is inherent owing to shifting customer needs to the sector and the nature of Climate change is a widely for cleaner fuels to meet their business that we conduct. As a accepted phenomenon, duly emission reduction requirements, result, our approach towards recognized by governments and thus providing a crucial business health and safety aims to ensure businesses alike. Being an energy opportunity.

Training on Fire Fighting Solar Photovoltaic cells being utilised OUR CORPORATE STRATEGY

While we continue to accelerate and optimize effective, economic and efficient use of natural gas to the benefit of nation, our future plans are built on the key pillars of sustainable business model, care for environment and surrounding communities. With this in the background, we defined our strategic objectives up to 2012 and have initiated Project “Next Wave” to articulate our aspirations and strategic priorities towards the next level of growth by 2020. OUR CORPORATE STRATEGY

We have made sustainable processes deployed have helped Natural Gas, accessible to Indian development a cornerstone of our us in creating focus and direction population at large, directly and business strategy to achieve to guide our sustainability agenda. indirectly. Balancing economic continued profitable, and We have established a baseline and growth, social development and responsible growth. We adopted driven by the need to minimize environment protection, we aspire the principle of materiality and risks, have moved to a proactive to expand our retail presence to a prioritized key sustainability issues approach by introducing large number of cities and towns after collective deliberation by the environmental and social risk for replacing polluting fuels with management. GAIL is committed assessments. This approach helped CNG and bringing PNG to the to play a key role in building us in identifying key focus areas – doorsteps of domestic and sustainable energy future for the Gas sourcing, Business growth, commercial consumers. Skilled manpower availability, country. Our core business of Going forward, we aspire that our natural gas transmission places us Customer satisfaction, Safety and security and Climate Change. topline should grow at a rate of ahead of many other energy around 16% in this decade. For companies in terms of making Today we can proudly say that sustainability is key part of our achieving this we are working on cleaner fuel accessible to Project “Next Wave” to identify consumers. While we continue to overall business strategy and reflects a clear understating of the key growth areas and initiatives, in accelerate and optimize effective, upstream, midstream and economic and efficient use of needs and expectations of our key stakeholders. downstream segments of natural gas to the benefit of nation, hydrocarbon value chain by 2020. our future plans are built on the Our vision and mission directs our The key focus will be on reducing key pillars of sustainable business corporate strategy and supports carbon footprint and aiming for model, care for environment and the leadership in defining a sustainable growth. For this, we surrounding communities. With roadmap to achieve business shall look at options for further this in the background, we defined objectives. Our short and long strengthening our portfolio of 37 our strategic objectives up to 2012 term objectives and associated renewable businesses (solar, wind, and have initiated Project “Next action plans focus on achieving etc.) in addition to global sourcing Wave” to articulate our aspirations business leadership in the energy and acquisition for bringing higher and strategic priorities towards sector. We have identified our volumes of natural gas in the the next level of growth by 2020. current business priorities in the country. By identifying and 2007-12 Strategic Plan and are pursuing such initiatives, we are We have started our sustainability successfully implementing its determined to play an important journey with a focus on improving various action points to further role in growing cleaner energy our economic, environmental and establish our pan-India presence. share in overall energy mix. Our social performance. The emphasis Our current strategy puts major endeavor is also to maximize is also on establishing a robust thrust on expansion of resource value through management system around infrastructure for making cleaner state-of-the-art technologies, sustainability performance. The and affordable energy source, strive for energy efficiency at each level of operation and consistently deliver best-in-class performance. Understanding long term resourcing needs and strategies needed to develop and retain employees is another focus area for building sustainable business enterprise. Our effort is to build sustainable communities through robust initiatives and interventions and take our enterprise to the highest benchmarks of LNG Terminal and Gas Based Power Plant of RGPPL at Ratnagiri, Maharashtra sustainability. CREATING SUSTAINABLE ECONOMIC VALUE

A healthy increase in profit has allowed us to invest in projects and fulfill our responsibility towards the sustainability of our business, by enhancing our energy security, developing local economy and managing the company’s environmental footprint. CREATING SUSTAINABLE ECONOMIC VALUE

Due to a strong domestic fuel With expansions planned for our and fulfill our responsibility demand for energy, Natural Gas petrochemical operations, we look towards the sustainability of our consumption has witnessed an forward to a stronger business business, by enhancing our energy impressive CAGR of 13.5% in last growth in this segment in the near security, developing local economy five years, making it the fastest future. and managing the company’s growing fuel consumed in our environmental footprint. country. With current energy Achieving cost savings through market scenario and strong online reverse auction Enhancing energy security domestic demand, it is expected In order to enhance clarity and India is the fifth largest consumer that Natural Gas demand would transparency in our procurement of energy and is expected to be quadruple to 600 MMSCMD by procedures, we initiated third largest consumer of energy 2030 from 154 MMSCMD in 2011. procurement through reverse by year 2025. With increase in Alongside Natural Gas, we also auction for high value demand for clean fuel and to have a significant presence in the procurement during FY 10-11. We enhance energy security of the petrochemicals business. During have formed a transparent country, we have taken several the year, our petrochemical procedure for reverse auction, expansions across operations to business experienced 1% increase which was applied first to tenders gear up to the rising demand. Our in turnover. Our Pata plant involving steel procurement, major expansions and measures to successfully commissioned an necessitated by the problem of promote this include: additional furnace in gas cracker fluctuation in steel prices. The first • Execution of ongoing cross unit to increase ethylene capacity. tender incorporating reverse country gas pipeline projects We are also setting up a 280,000 that will augment our pan-India TPA petrochemical complex in auction procedure was floated for procurement of bare CS line pipe presence with total pipeline Assam and 1.1 MMTPA network of about 14,500 kms. petrochemical complex in Dahej for a pipeline project, which resulted in a saving of around INR through our subsidiary and JV 7This is an indicative performance table company respectively. Further, 400 million. showing essential components depicting our capacity of Pata plant is being economic performance. For complete Investment for Development disclosure on our financial performance, 39 doubled by installing 450,000 TPA please refer to our Annual Report for the of gas cracker unit and 400,000 A healthy increase in profit has year 2010-11, at the link http://gailonline.com TPA of downstream polymer unit. allowed us to invest in projects /final_site /pdf/GAIL_AR_2010_11.pdf

Parameter7 FY 08-09 FY 09-10 FY 10-11 Trend (all values in INR million) over last FY Total 238,984 249,964 324,586 ↑ Revenues Operating 276,544 208,891 204,040 ↓ Cost Profit After Tax 28,037 31,398 35,611 ↑ (PAT) Employee Remuneration 5,767 6,212 7,527 ↑ and benefits Payments to providers of 9,749 10,214 10,343 ↑ capital (dividend+interest) Payment to 39,707 38,401 44,425 ↑ Government (taxes) Subsidy paid to 16,940 13,270 21,110 ↑ OMCs • Doubling of capacity of gas Nehru National Solar Mission. Sharing of under-recoveries by based Petrochemical Plant at • Undertaking experimental GAIL Pata, at an investment of INR projects to assess the 81,400 million. technical feasibility of new In order to protect the consumer • Our interest in 27 E&P blocks sources of energy, viz. from large fluctuations in energy including two outside India hydrogen and land-fill gas. prices and inflationary pressures, and one CBM block for Government of India is proactively securing long term gas Generating local livelihoods addressing the challenge by supplies. We understand the need for providing consumers with • Ensuring entry in the LNG developing locally based suppliers. subsidies. In line with Government terminal through the equity The development of local directives, GAIL is assisting and stakes in Petronet LNG and suppliers ensures uninterrupted sharing the burden on account of RGPPL. supply of local goods essential for such under recoveries on • Acquisition of 4.17% equity our operations and at a lower cost domestically used LPG and stake in South East Asia Gas to the environment. At the same Kerosene. As a result, we have Pipeline Company which is time this also contributes in shared a cumulative sum of INR executing Myanmar to China st developing a stronger local 106,500 million up to 31 March gas pipeline project. community by generating more 2011 including INR 21,110 million • As a nodal agency of employment and livelihood. in FY 2010-11. Government of India to look for overseas Gas supply, one Proportion of procurement from of the major initiatives is 100 local based suppliers (%) development of Turkmenistan -Afghanistan-Pakistan-India 80 (TAPI) Natural Gas cross 93.50 86.69 border pipeline project. 60 63.62 • Investing in a 115 MW wind power project in the states of 40 Gujarat, Karnataka and Tamil 40 Nadu. 20 • Investment in solar power by active participation in future 0 bidding under Jawaharlal 2008-09 2009-10 2010-11

A View of GAIL's Petrochemical Plant at Pata, U.P. CREATING SUSTAINABLE ECONOMIC VALUE

Spending our profits on further spread the outreach of our million, while the CSR expenses environmental and social CSR activities. (as on 31st March, 2011) incurred endeavors were INR 599 million. For achieving our CSR objectives A part of GAIL’s annual budget is through implementation of We measure and monitor our infused into our community meaningful and sustainable CSR expenditure on environmental development programs and for programmes, we have increased management initiatives particularly our work towards protection of our annual CSR budget from 1% in relation to actions taken for the environment. We have to 2% of the previous year’s Profit reduction of our environmental invested INR 338.56 million in this After Tax (PAT). This budget is year for developing infrastructure non-lapsable with any unutilized footprint and mitigation of any for communities and improving CSR allocation of a particular year adverse impact on natural access to public good. With more getting carried forward to the resources. In 2010-11, we than 50% increase in our CSR succeeding year. In this year, the invested a total INR 42.97 million expenditure, we remain upbeat to CSR allocated budget was INR 695 towards environment protection.

Our environmental management expenditures (INR million)

50 42.97

40 35.24 31.99 30

20 41 10

0 FY 08-09 FY 09-10 FY 10-11

LPG Loading Station MANAGING OUR ENVIRONMENTAL FOOTPRINT

We have the largest Natural Gas pipeline network in India spread over diverse geographic regions. Despite inherent environmental, safety, security and social risks, GAIL has an enviable track record in taking requisite measures to mitigate these risks. MANAGING OUR ENVIRONMENTAL FOOTPRINT

Energy and climate change Our energy consumption (million GJ) 39.60 40 37.69 37.46 38.41 38.55 While the global demand for 36.75 Natural Gas, a relatively cleaner 35 fuel is expected to grow at a prolific rate, non-availability of gas 30 would pose a major threat to our 25 business in the future. This challenge is relatively more critical 20 to GAIL as we have a major 15 market share in the Indian Natural Gas market. Although, we have a 10 limited control on the availability 5 of the product, we are taking 0.94 0.95 1.01 0 measures to manage this resource FY 08-09 FY 09-10 FY 10-11 efficiently and exploring alternate sources of energy. We utilize wind Total direct energy consumption Total indirect energy consumption power at our Gandhar, Kandla and Samakhiali units and solar power Total energy consumption at Mumbai, Baroda and Abu Road units. We have planned to set up a and stimulates innovation across consumption across our plants and 100 MW of wind power operations that help us in other operations. Some of our generation infrastructure every performing better. Our total other major energy efficiency year till 2016. In this manner we energy consumption in FY 10-11 improvement initiatives are will be able to increase our was 39.60 million GJ, a marginal mentioned below: renewable energy portfolio to increase of 3.1% from FY 09-10 • At Gandhar, we optimized 43 meet our internal energy primarily due to growth in Gas & bleed valve operation by requirements and cater to the LPG transmission business. We re-tuning the valve and commercial demand for power in also focus on sourcing wind and SoLoNox mode operation that the remote locations where our solar energy for captive resulted in reduction in specific units and pipelines are located. consumption. During FY 10-11, we consumed 31,749 GJ of energy fuel consumption from 1.93% To reduce the environmental from such renewable sources. to 1.80% accounting for saving burden in our operations, we are of nearly 1.09 MMSCM of taking measures for improving Across operations, we have Natural Gas annually. efficiency of our processes. This dedicated energy conservation • At Pata, we have installed an also ensures optimal use of energy teams that focus on conserving automatic blow down system resources. Enhanced energy energy. We were able to save in heat recovery steam efficiency reduces cost, has a 685,771 GJ of energy mostly on generator (HRSG) resulting in positive impact on climate change account of decreased electricity reduction of blow down quantity by online monitoring of TDS levels, leading to saving of 0.18 MMSCM of Natural Gas annually. • At Gandhar, we have used technologically improved molecular sieves in feed gas dryer that resulted in saving fuel gas consumption on account of reduction in regeneration cycle from 12 Highly efficient VSD motor hours to 36 hours. This led to total saving of 0.52 MMSCM of GHG emissions from our operations (’000 tCO2e) 3000 Natural Gas annually. • At Usar, we have implemented an initiative to recover LPG 2500 2,889.39 2,800.62

vapors that used to vent out 2,716.59 2,635.01

2000 2,563.70 during inspection of mounded 2,481.40 storage tanks. Re-circulation of vapors as part of this initiative 1500 has resulted in saving of 96 MT of LPG in this year. 1000 • At Pata, we have installed a revamped BOG compressor to 500 254.38 235.19 divert boiled-off gases directly 236.92 to downstream polymer plant, 0 resulting in saving of 762 MT of FY 08-09 FY 09-10 FY 10-11 VHP steam in this year. Total Scope Total Scope Total GHG Although it is a widely accepted 1 emissions 2 emissions emissions postulation that Natural Gas offers Other air emission from our operations (MT) a number of advantages in 1000 mitigating climate change impacts FY 08-09 as compared to other fossil fuels 810.59 because of its low carbon content, 800

716.32 FY 09-10 we are committed to reduce the 630.43 FY 10-11 climate change impacts in our 600 44 operations. Our total GHG emissions across operations in FY 400

10-11 were 2.889 million tCO2e. 333.36 We were able to avoid 7948.12 226.46 226.89 215.30 179.76 164.12 178.64 tCO2e of greenhouse gas 188.06

200 173.59 emissions owing to our energy efficiency measures. We also focus on managing and reducing 0 SPM NOx CO SOx other air emissions like SOx, NOx, SPM, CO and ODS. Increased use of low-NOx burners across our operations has helped us in reducing our NOx emissions by approximately 12% over the last year. During the year, we also emitted ozone depleting substances amounting to 72.42 kgs of CFC-11 eq. Though we are not significant users of ozone depleting substances, we monitor the efficiency of our refrigeration and air conditioning equipments to ensure that these emissions are minimal. Maintaining Greenery around Plant area MANAGING OUR ENVIRONMENTAL FOOTPRINT

Natural Gas processing in our operations (MMSCM) Responsible resource use 16000 14,943.54 15,103.66 Our scale of operations has 14,722.03 reached a level of 15,000 14000 12,964.19 13,342.26 13,121.74 MMSCM8 of gas processing, 12000 43,037 MMSCM of gas 10000 transmission and 420,000 MT of polymer production this year. This 8000 increase in operations has also led 6000 to an increase in consumption of process materials. Our petro- 4000 chemicals business in comparison 1,123.43 to our Natural Gas operations is 2000 1,085.73 1,060.21 material-intensive and has a scope 0 of improvement in terms of FY 08-09 FY 09-10 FY 10-11 efficient resource use. We have NG processed NG sent back to pipeline taken steps to ensure responsible use of materials, by optimizing our NG used for making product resource use and improving our operational efficiencies. Our well maintained Material consumption in our operations (MT) environmental management 16000 systems and best management 14000 12,815.86 13,560.23 practices at all our sites have 12,206.78 helped us in optimum resource 45 12000 use. This has led to reduction in 10000 the equipment downtime and energy expense. In addition, we 8000 have an Operation and 6000 Maintenance Policy, which outlines the objective, targets, philosophy 4000 and guidelines for maintenance 2000 8The total NG processing figure constitutes all 0 operations under the scope of the report. This FY 08-09 FY 09-10 FY 10-11 figure does not include NG processed by our GPU at Lakwa

Hazardous waste generated

Type of hazardous waste Quantity FY 2008 FY 2009 FY 2010 Used oil MT 149.83 137.05 173.23 Used batteries Nos. 0 15 15 MT 0.18 5.34 1.1575 Basket filter waste Litres 120 120 120 Molecular Sieve MT 0.5 0 100 Tar MT 2.6 3.35 19.5 Tar ash MT 0 0 15.2 Oily sludge MT 300 300 282 across our operations. This policy impact on the surroundings. Some 2009 and 7500 saplings in 2010. focuses on increasing process of the efforts worth a mention are The entire area was divided into efficiency and decreasing our biodiversity management small zones and each employee downtime to ensure optimum use activities at Pata and Samakhiali. At adopted one zone to ensure the of resources. For our waste Pata the site conditions were survival of the plants. Our Green management, we have taken extremely hostile to any green Belt area is approximately 41% of several steps to improve handling cover development as the soil had our total land holdings which is and disposal of hazardous waste. a high pH value of around 11 and around 17.2 million square meter. conductivity of around 6.5. By Used oil, lube oil and oily sludge Elimination of open draining of are the most significant hazardous extensive soil treatment we corrected its alkalinity and Propylene during annual waste generated from our shutdown 2010 operations. We have ensured restored the soil balance, thereby proper disposal of hazardous resulting in an increased green Our petrochemicals unit at Pata cover. Since the Samakhiali unit is waste through CPCB-authorized uses a propylene refrigeration situated in the barren lands of waste handlers who process these system for chilling requirements in Kutch district, the hot and humid wastes and ensure minimum LPG Recovery Unit, Gas Cracker environment combined with saline Unit and LLDPE recovery unit. To impact on the environment from soil prohibit growth of any their disposal. We are recycling vegetation except for some save a large amount of propylene two of our major wastes; slop oil grasses and dry thorny scrubs. from being flared, provisions were and spent alumina from our Our employees made a resolution made in the past for transferring petrochemicals operations in Pata. to plant around 10,000 saplings in this propylene back to its storage. This has helped us in reducing However, this reversal required material costs, amount of waste Our Green Belt Cover draining of liquid propylene filled from going to the landfills and the up in the line, creating safety and costs of transporting waste to the environmental hazard to the landfill. Recycling of these 41% surrounding area. Our operations materials accounted for 9% of our team installed a pressure gauge in 46 total material consumption in FY the downstream of the make-up 2010-11. line of propylene to check the Managing our impact on pressure of line. Installation of the nearby biodiversity pressure gauge in the downstream of make-up line to accumulator Most of our operations particularly enabled us to depressurize the line the pipelines are at remote when the pressure reduced to 0.4 locations where there is higher Kg/cm2. This helped in avoiding 59% likelihood of disturbing the natural open drainage of propylene, ecosystems. We are conscious of thereby saving material and these sensitivities, and thus plan Total Area Green Belt avoiding safety risks. our activities to have a minimum

View of Raw Water Reservoir at Pata plant MANAGING OUR ENVIRONMENTAL FOOTPRINT

Managing water resources Our water consumption (million m3) 15 13.78 We are consciously optimizing our 12.81 water consumption in all our 12.26 operations and also making 12 provisions for easy access to water for nearby communities. During 9 FY 10-11, our total water consumption was 13.78 million9 cu.m. 96% of this consumption 6 was sourced from the surface water. Through initiatives involving 3 recycling and reuse of treated wastewater, we were able to 3 replace 0.73 million m of our total 0 water intake with this recycled FY 08-09 FY 09-10 FY 10-11 water. This also helped us in avoiding 45.19% of the total treated water is recycled. Majority Our water consumption wastewater generated getting of our units10 are not water discharged from our facilities. We intensive and do not yield have taken steps to increase water significant wastewater streams. availability in vicinity of our During FY 10-11, 854,255 cu.m of 96% operations. One leading example treated wastewater was disposed in this case is at our Gandhar unit, outside our operational where rainwater harvesting was boundaries. 47 done in a land depression formed due to excavation of soil for Managing environmental construction purpose. Using impacts during pipeline satellite imagery and contouring, a network expansion and scheme was prepared to divert operations the run-off water effectively into Our pipeline are designed, the pond. The rainwater constructed and maintained in line harvesting pond thus created was with the requirement of Surface water (river, sea, lake, stream) used to collect over 6000 cu.m of international standards like the Groundwater rainwater during the single ASME, API, DIN, ISO and national monsoon season of 2010. We have standards like the OISD. The Muncipal water supply taken our commitment towards pipeline network is designed after Water tankers and utilities increasing water availability one a detailed environmental impact step further by providing assessment and series of approvals awareness sessions on 9 from Ministry of Environment and Our water consumption data does not conventional and modern methods contain water consumed by units in Agra Forests. The pipeline alignment is of rainwater harvesting to the region. We are enhancing our monitoring selected in such a way that the systems in the region and will be able to villagers near our Usar unit. They length is optimized avoiding report their contribution. were also given technical ecologically sensitive and 10 assistance for conducting water Barring Pata and Vizag units, all other protected areas/ geographically units do not discharge any wastewater quality monitoring. outside their boundaries. Additionally, our unstable areas/ less number of wastewater discharge information does not To maintain the quality of water in obstacle crossings like NH/SH/ contain wastewater generated or our surroundings, we are Railways, restricted / reserve discharged by units in Agra region. We are enhancing our monitoring systems in the discharging treated waste water in forest area/ Coastal Regulation region and will be able to report their a responsible manner. Most of the Zones (CRZ). contribution. CREATING A BETTER WORKPLACE

An enlightened, skilled, committed and enthusiastic workforce has been the driving force behind our success. We are aware of the fact that retention of right talent and skills will be a key success factor that will determine our growth in the next decade. As a business success measure we have been consistently tracking value added per employee – an account of an effort of company’s employees to make the best and most productive use of resources available to them. CREATING A BETTER WORKPLACE

Value added per employee (INR lakhs) The overall management of human 200 resources is driven through our 195.62 comprehensive HR policy that 160 164.37 175.11 covers several essential areas 120 ranging from employee development to grievance 80 redressal. Director (HR) holds prime responsibility for adequate 40 implementation of the HR policies and procedures consistently 0 FY 08-09 FY 09-10 FY 10-11 throughout the organization. In light of the exceptional business Total workforce breakdown (numbers) growth in the past few years, the HR policy and governance

1500 1429 framework has been able to support it through a readily 1293 1275

1236 available talent pool at all levels 1150 1200 1146 within GAIL. 1060 1002 973 Our human resource policies and 900 practices are inclined towards total individual development, addressing our employees’ key 600 concerns related to career progression and welfare. We offer a challenging and engaging work 49 300 experience to our workforce that 194 177 166 motivates them to perform better and in turn contribute to their 0 success and our growth. This is a Senior Middle Junior Non-management major factor in retaining our management management management workers talented professionals for a long FY 08-09 FY 09-10 FY 10-11 duration. Our attrition rate in FY 2010-11 was only 0.52%11, which underlines our achievement in 30 Our workforce turnover (numbers) 27 retaining the right talent in our organization. 25 We believe that inclusion and empowerment of people will 20 18 make them more creative and productive. We lay strong 15 emphasis on understanding our 11 employees’ concerns and their 9 10 expectations to increase their 7 6 motivation levels and keep them 5 efficient at all times. Expectations 0 00are managed by identifying 0 FY 08-09 FY 09-10 FY 10-11 11During FY 2010-11, 20 people left the <30 years 30-50 years >50 years organization, comprising of two female employees Overall attrition (%) Employee engagement survey 1.0 0.93 This survey was conducted during FY 2010-11 to gauge the 0.8 engagement level of the 0.68 employees as we believe that only engaged employee will go an extra 0.6 0.52 mile in delivering superior results. Nearly 60% of the GAIL 0.4 employees responded to the survey. Valuable feedback was received from the employees on 0.2 People Practices and suggestions were also taken for improving overall employee experience at 0.0 GAIL. Based on the analysis, the FY 08-09 FY 09-10 FY 10-11 overall “engagement score” was 71%, which placed GAIL in the concerns through employee morale by organizing events and Hewitt’s Best Employer Range. engagement surveys and employee activities during important festivals This means that majority of our suggestion schemes. A major and other significant occasions for workforce is engaged effectively in thrust area of the organization has employees and their families. A the organization. Further, on the been to provide our employees special Sports Promotion Policy basis of the key findings, action with a conducive working has been initiated that provides plans have been drawn up on the atmosphere, especially in the support towards identifying and key areas of improvement. remote locations where access to nurturing potential talent amongst Suggestion scheme high quality living is low. We have our employees and their families. 50 GAIL recognizes that an individual’s invested towards developing We have also developed adequate talent, creativity and initiative could residential and commercial areas, sports infrastructure to train our be best used by them by sports facilities, clubs, schools and employees and prepare them for incentivizing, encouraging and medical facilities in such regions. participation in national, regional motivating the employees. To We have also undertaken several and company level sports meets achieve this we have set up a initiatives to boost the employee and tournaments. “Suggestion Scheme”, in which we encourage our employees to propose any suggestion to achieve organizational excellence. This also helps GAIL to inculcate a constructive and an open work culture in the organization, which is conducive during this phase of transition. This scheme has a structured system, in which suggestions are received, recorded and then addressed. This system helps in evaluating and accepting the creative ideas of the employees. The suggestion scheme is directly made available to employees through the use of GAIL intranet. The best suggestion is rewarded and acknowledged by senior management of the company. CREATING A BETTER WORKPLACE

Training and development Training imparted to our people (’000 man-hours) 150 We have a structured process for 131.79 134.63 125.73 training and development of our employees to ensure a workforce 120 that is suitably equipped with knowledge, skills, attitude and 90 practical exposure to highly 75.96 specialized jobs. Our GAIL Training Institute (GTI) set up in 60 the year 1997 at Noida is an ISO 46.56 9001 certified facility that provides 28.28 resources and facilities for all kinds 30 of training to our employees. To cater to maximum employees into this process, we have increased 0 our infrastructure by setting up FY 08-09 FY 09-10 FY 10-11 another GTI in Jaipur in 2005. Total traning for direct employees (across GAIL) During FY 2010-11, 14,298 man-days of training were Total traning for contractual workforce (across GAIL) provided by GTI against a target of 14,000. The GTI also received the prestigious National Award for Innovative Training Practices from Indian Society of Training and Development (ISTD) in January 2011. In its pursuit to offer high 51 quality trainings to external organizations and convert itself into a revenue generating center, GTI has successfully conducted training programs for other renowned organizations like IOCL, BPCL, IGL, Siti Energy, Opal, Honda Scooters and Motorcycles Limited, amongst others. Training effectiveness is one of the key reasons for the success of GTI. GAIL Training Institute at Noida The institute has designed its own training evaluation system based improvements and cost savings current talent pool of the on four core parameters- reaction, have been achieved as a result of company, we have designed a learning, behavior and results to the training. leadership development program measure the return on investment known as the Senior Management of the training courses. This In order to cater to the Development Center (SMDC). system takes into account the development needs of a growing This program enables to place opinions of participants about the workforce, we have been competent persons at strategic course, how well they have continuously scaling up our roles. The objective of this mastered the course objectives, learning and development efforts program is to identify the how well they have used the and exploring innovative models development needs of senior knowledge, skills, and/or values for higher quality and penetration executives and design from the course and what kind of of our training programs. In an development programs to bridge performance improvement, quality effort to nurture leaders from the any gaps. provided operational training to their employees. • GTI successfully developed and delivered a course on Natural Gas Business Management for the MBA students of Rajiv Gandhi Institute of Petroleum Technology (RGIPT). Mentoring of new-entrants at GAIL We recruited around 200 executive trainees in the last two years. Mentoring has been used as an effective tool to explore and Director HR Addressing to Employees nurture leadership qualities. At the same time it has also helped them Learning and development • GTI Noida organized new overcome the initial initiatives programs like Management communication barriers that are Development Programs typically faced in a professional Some of the significant initiatives (MDPs) for newly promoted setup. The initiative was started in taken for human resource DGMs, GMs and EDs in April August 2010 through a series of development by our company in and May 2010, workshop on workshops for mentors and the year 2010-11 include: behavioral based safety for mentees at GTI Noida, GTI Jaipur, 52 • Launch of ASME (American Officer in charges (OIC) in GAIL Pata and GAIL Vijaipur January 2011 and effective Society of Mechanical covering about 144 new recruits. communication skills for Non Engineers) certified courses at This program has helped Executives through video GTI Noida as an authorized employees to undertake healthy conferencing during December training provider to ASME. and open discussion with mentors 2010 to March 2011. Four faculty members from on work related as well as GAIL have been certified by • GAIL assisted in the administrative issues, enhanced ASME as authorized training commissioning of Panipat their confidence levels and instructors for offering these Petrochemical plant of Indian synergized their energies during courses. Oil Corporation and also on-the-job training phase.

Workshop at GAIL Training Institute, Noida CREATING A BETTER WORKPLACE

Upholding human rights

Compliance GAIL is a firm supporter of the Audit Emergency UNGC principles and values that Planning & Respnse

support protection of human Leadership & Commitment Employee rights across our operations. GAIL Participation Environment Facility, Design Construction policies have been suitably Management & Prestartup Review designed and followed keeping the Process Safety Information principles of Human Rights, the Occupational Constitution of India, Labour laws Health Risk Analysis & etc. in mind. In GAIL there is a set Managment policy for handling grievances of Accident HSEMS 3rd Party Investigation Services employees and the stakeholders. & Analysis There are enough controls and Personal Safety

checks at all levels to identify and Control of Defeat Training & Reliability of prevent such incidents of breach. critical devices Work Permit We support the Government of System

India’s efforts in development of MOC minorities and economically Inspection & Maintenance

Operation & underprivileged sections of the Maintenance society. We have made provisions for recruitment of a certain percentage of our workforce from encompassing entire business elements on a monthly basis. the SC, ST and OBC categories to operations and risk profiles. The These predefined elements are uphold our commitment to corporate HSE policy is the apex Leadership and Commitment; affirmative action. Despite document of this system and is HSE Training; Incident Reporting; 53 inherent challenges within our approved and signed by CMD. Investigation and Analysis; sector towards recruitment and The efficacy of the implemented Employees Participation; Control retention of women employees, system is also subject to audits by of Defeat & Reliability of Critical we have been focused in our reputed national and international System & Devices; Process Safety efforts to create a conducive agencies. Appropriate corrective Information; Operation and environment for them. A special measures are taken in time bound Maintenance; Emergency Planning Women’s Cell at GAIL is focused manner to eliminate gaps and Response; Compliance Audits; on reaching out to the women identified during such audits. Occupational Health; workforce, initiate discussions and The HSE performance of the sites Environment Management; adequately address their concerns is constantly monitored on the Inspection and maintenance; and including sexual harassment at basis of relevant and predefined Risk Analysis & Management. workplace. Additionally, we have set up Ladies’ Clubs at our operational sites and have instituted GAIL women’s awards to promote their involvement and enhance satisfaction. Health and Safety GAIL has a well established health, safety and environment management system (HSEMS) which is based on OISD GDN-206. Our HSEM system comprises 18 elements Based on the performance of the HSE Index Trend sites, a HSE index is assigned to 98.95 99.25 98.92 the site as well as for overall 100 97.00 97.50 97.50 operations of GAIL. HSE performance is part of GAIL’s MoU with the ministry of 80 Petroleum and Natural Gas. In last five years we have consistently exceeded the MoU targets. The 60 established and implemented HSE systems are subjected to review 40 by the Board Level HSE subcommittee, which is the apex body in GAIL for reviewing the 20 HSE performance and Emergency preparedness of the organization. 0 To effectively combat any 2008-09 2009-10 2010-11 emergency across installations, MOU Target Achieved emergency mitigation plans are in place. These emergency mitigation subject to periodic review for management in the organization in plans are based on risk perception their effectiveness. We are line with applicable environment of respective installations and are committed to the environment regulations and statutory requirements.

Our safety performance Workforce Description Units category FY 2008 -09 FY 2009 -10 FY 2010 -11 54 External safety audits Numbers NA 15 18 20 HSE Awards Numbers NA 26 36 31 Employees 142 174 17 6 Near miss cases Numbers Contractors 162 180 18 3 Employees 1 5 2 Minor injuries Numbers Contractors 3 8 17 Employees 1 0 2 Reportable injuries Numbers Contractors 1 0 1 Employees 45 0 115 Lost days due to Numbers reportable injuries Contractors 75 0 32 Employees 0 0 1 Fatalities Numbers Contractors 0 1 3 Reportable Lost time injury frequency injuries per Employees 0.16 0 0.32 rate million man hours worked Contractors 0.06 0 0.07 Lost days per Employees 7.36 0 18.21 Severity rate million man hours worked Contractors 4.66 0 2.29 Fatalities per Employees 0 0 0.16 Fatality rate million man hours worked Contractors 0 0.08 0.22 CREATING A BETTER WORKPLACE

GAIL is committed to operate age group 35 years or above are incidents and risks early and is with excellence, with a focus on entitled to undergo periodical full trained to give an effective continuous efforts to improve medical check-ups once in two response. We have a special focus environmental performance for years. Tie-ups have been made on building capabilities of our ourselves, our stakeholders and in with the reputed hospitals of the security personnel across harmony to the needs of the stake country for providing quality operations and conduct effective holders for sustainable health care facilities to our trainings and mock drills on environmental growth. employees and their dependents. emergency preparedness. A large number of security personnel are Occupational health is an integral Security part of our HSEMS. We have recruited from the defense forces. established medical attendance Security of the gas pipeline and We have also introduced an rules to promote medical prevention of any external internal magazine ‘Rakshak’ to check-up and health consciousness sabotage is a high priority for the share leading practices on safety amongst all employees. As per company. Our workforce and security within the oil and gas these rules, all employees of the specializes in detection of such sector.

55

Dedicated Emergency Response Van

Occasion of Security Awards during the Security Awareness Week Safety Training Session in Progress for Drivers BUILDING VALUE FOR OUR CUSTOMERS

Addressing customer grievances and concerns related to improvement in our products or the services is of utmost importance to GAIL. We have strengthened our customer relationship management systems over a period through a combination of statutory and voluntary efforts. BUILDING VALUE FOR OUR CUSTOMERS

In this year, we introduced some new measures and reinforced existing initiatives to improve customer satisfaction. We have established suggestion systems for our customers to proactively reach out to us and provide feedback on how we can improve our products and services. Our customer satisfaction survey calculates a Customer Satisfaction Index (CSI) to highlight strong areas and improvement opportunities from the customers’ perspective. Our Customer CNG Station Relationship Management module is informative and provides the use, product safety, pricing, During the year, we received customer an ease of putting in discounts and availability. These customer feedbacks regarding gas service requests or product sessions are instrumental in measurement and calibration requests while keeping an online increasing the trust of our errors. Based on the track of the requests. customers in our business. We recommendations of our vigilance also connect with them by function, we took several An important aspect of our celebrating festivals and measures to improve our gas relationship with our customers is conducting interactive meets. 57 the frequency of our interaction. It metering system including: One of our meetings at Agra on is essential for us to keep our • Installation of differential vigilance recommendations is a customers informed about the pressure transmitters and latest developments related to our classic example on our responsiveness to customer orifice meters with products and their use. queries. Organized with glass specifications in consonance Additionally, it is also vital that we manufacturing associations and the with quantity of gas required to listen to their queries and district administration, this be measured concerns. To facilitate this meeting brought to our purview • Instruction to sites on keeping dialogue, we organize customer concerns related to transparency records of audit trail, meets across the country through in, and fixation of priority in configuration log, maintenance our marketing offices. During FY allocation of additional quantity of log and mis-measurement of log 10-11, several meetings were RLNG on fall-back basis. As a and calibration log organized for different product follow-up to the meeting, our segments like gas, petrochemicals, • Use of plastic tape seals having team reviewed O&M activities at printed numbers and signed by etc. in the cities of Bhopal, Kota, the Firozabad City Gas Station and Officer-in-Charge to seal Kolkata, Chennai, Lucknow, Goa, conducted surprise visits to six configuration ports to avoid New Delhi, amongst others. factories in the region. Based on manipulation These meetings have brought out the observations, we have initiated several aspects of product use, the implementation of SCADA • Use of digital communication such as information on possible system in Firozabad area to link between gas applications of GAIL’s products transparently allocate RLNG to chromatograph and flow (particularly in petrochemicals), customers. In two phases, there computer for mapping online current market scenarios, local are plans to implement this system data on gravity and heating developments influencing product across 182 customers. value to avoid errors Measuring customers’ calculated for each quarter. CSI is departments at the state transport confidence in our products measured across various levels of corporation enabling them to organization to recognize their devise their strategy to focus on Considering the relevance of individual performance, viz. vehicles that require more customer satisfaction to excel in business segments, zonal offices, attention, leading to better competitive business environment and overall. Internal actions and maintenance whilst improving and to serve our customers better, decisions are taken regarding CSI awareness towards environment. GAIL initiated the Customer scores and measures are taken to Satisfaction Index (CSI) in the year scale it up to above 88%. Extending our responsibility to FY 2006-07. This survey and its product pricing results gain importance in our Increasing customer awareness GAIL is one of the most significant discussions with the MoP&NG and To improve consumer awareness suppliers of liquid hydrocarbon thus form the part of the with respect to various (LHC) products in the Indian performance MoU that we sign applications of natural gas, we market. Taking cognizance of our with MoP&NG every year. The conduct specific awareness position and the importance of questionnaire used for this sessions and drives. This has a our role in supplying affordable assessment is developed by our two-way benefit of enhancing products to our customers, we Total Quality Management customer awareness while being a have developed transparent ‘LHC department at the corporate level marketing vehicle for the Products Pricing Policy’ to along with zonal offices and advice company. Our PUC camp initiative formalize the pricing procedures from reputed consultants. To in Alibaug, Maharashtra is a for LHC products and improve ensure maximum participation, success story in this regard. the governance of pricing this questionnaire is made During FY 2010-11, our Usar unit mechanisms at GAIL. As part of available in both online and manual organized free PUC camp for all this policy, all prices for LHC form. Our questionnaire focuses state transport buses on the products are proposed by the on critical aspects of product occasion of World Environment pricing committee. Our LHC 58 responsibility viz. product quality, Day. This program was attended Products Pricing Policy, along with use, technical support, packaging, by workshop employees, bus our Polymers Pricing Policy, helps material delivery, quality of drivers and conductors, journalists us in ensuring the right prices for service, and customer and common public. This exercise our products that are in concerns/problems. The annual resulted in compilation of statistics synchronization with the dynamic CSI assessment exercise covers all about State Transport buses and market conditions with a view to our business segments. Based on their associated pollution levels. provide affordable products to the customer feedbacks, CSI is The initiative helped maintenance customers.

Interacting with Customers BUILDING VALUE FOR OUR CUSTOMERS

Pursuing innovation India, we foresee an important Land-fill gas to CNG – a role played by R&D to ensure that possibility developed at GAIL GAIL puts a strong emphasis on our products gain quality the need for innovation for its improvements and create Landfill gas, emanating from city operations. Innovation is a favorable differentiation amongst landfills (or municipal solid waste significant opportunity for us, other similar products in the dump yards) is one of the largest whether it results in reducing market. We are currently in the operational costs, increasing sources of methane emissions process of formulating an R&D efficiencies, creating a market globally. Under a unique policy to boost our efforts in this differentiator or providing a collaboration with the Municipal field. Currently, our R&D function competitive edge. It also helps us is working on the following major Corporation of Delhi, we have to explore new energy resources thrust areas: initiated a R&D program to for meeting India’s growing • Hydrogen research initiatives in recover this land-fill gas, purify it demand for clean energy. production, storage and and make it suitable for During FY 10-11, we successfully application commercial use in our CNG and carried out development/ • Underground coal gasification PNG products. Initiated in modifications in polymer grades • Landfill gas to CNG December 2010, we are currently based on customers’ requirement • Conversion of waste plastic to preparing the detailed project by modifying properties such as value added hydrocarbons melt flow index, process ability • Development of adsorbents for report and feasibility reports. The and surface smoothness etc. natural gas success of this project will pave leading to process improvements • Non-conventional hydrocarbon the way for integration of waste to and savings at our customers’ end. use energy products in our operations. As we strive to be one of the top • Development of new polymer two petrochemicals players in grades 59

Various uses of GAIL Polymers CONTRIBUTING TO COMMUNITY DEVELOPMENT

We are a part of the community, wherever we operate. Our operations and projects generate livelihood for the local working population and bring developmental benefits for the community. CONTRIBUTING TO COMMUNITY DEVELOPMENT

We work along with our need-based identification of operational facilities and projects communities to support their programmes followed by a robust as follows: development, attempt at implementation plan. As a part of alleviating their key societal the due diligence for undertaking • Identification of programs concerns, and at the same time meaningful projects, a cross Identification of the ‘right’ minimizing potential negative functional committee comprising programs that can lead to the impacts of our operations. Our Heads of various functions has maximum impact on commitment towards corporate been constituted at the corporate communities is critical. This is social responsibility has come a level. We have also constituted a done by conducting long way from merely adhering to CSR sub-committee at the Board need-identification studies by government promoted level to enhance governance of professional agencies, internal rehabilitation activities way back in our social performance. Further, need assessment by the 1990s to a distinct business we have earmarked 2% of our cross-functional team at the function with a structured previous year’s PAT annually facilities, receipt of proposals framework today. Our community towards CSR projects, focused at from local government programs are now carefully bridging the gaps and improving agencies, followed by identified through a diligent the quality of life of the discussions and feedback process of need identification and communities. As a reinforcement sessions with the local assessment exercise at the grass of our enhanced social representatives and civic root level and consist of a wide commitment, the CSR bodies. Programmes identified spectrum of welfare and performance indices have been at the work centre level are developmental activities. All our included in the MoU being signed sifted at the corporate level by programs are structured under with the MoP&NG from the FY the CSR department and the seven broad ‘thrust areas’ - 11-12. cross functional committee of Community Development, We follow a systematic approach departmental heads before 61 Infrastructure, Water & Sanitation, of planning and implementing our submission to the approving Literacy Enhancement, CSR projects at the major authority. Educational Aids, Environment Protection and Health. As an organization that creates significant economic value through its operations, we are committed to developing our communities who contribute to our success Program Program through provision of raw identification Sustainability materials, manpower and support during our operations. We feel that by deliberating on their significant concerns and working Our CSR towards alleviating them, we can approach contribute to their overall development.

During FY 10-11, we refined our Monitoring Program CSR policy to augment GAIL’s and feedback implementation involvement and commitment mechanism towards community initiatives. The CSR processes have been diligently honed to ensure a more effective mechanism for • Ensuring program • Monitoring and feedback for improved living conditions for sustainability A robust monitoring mechanism villages. There are several pockets We have established internal is important to govern the of villages having low economic systems for identification and progress of each CSR program, progress over the past many implementation of CSR in turn ensuring timely and years. We conduct livelihood programmes for these families, programs through effective implementation. Each particularly small and marginal project-based accountability operational unit at GAIL is required to send a monthly farmers, to ensure sustained approach with well-defined socio-economic development of timelines and project report on the progress of projects under execution. people who are below the poverty milestones. While identifying These reports are collated to line in the country. Additionally, programs, we ensure that the we are also working with other oil develop a comprehensive projects will sustain themselves and gas PSUs towards provision of monthly CSR report sent to the LPG connections to these families once GAIL exits after Functional Director for review. completion of all relevant under Rajiv Gandhi Gramin LPG This is instrumental in close Vitrak Yojana. objectives and milestones. monitoring of our annual CSR Our community development • Program implementation programs and helps us in taking activities also revolve around CSR programs approved on an corrective actions. To objectively assess the developing children, who are the annual basis by the CSR Sub implementation efficacy and face of India’s bright future. Committee of the Board are impact of the major projects, During the year, we sponsored implemented through external third party assessment is vehicles for mid-day meal implementing agencies like undertaken, besides internal schemes. We adopted destitute NGOs, Government bodies and assessment. tribal children at an orphanage in even other corporates. Jhabua, Madhya Pradesh to Programme implementation is Community development support their living and ensure a better future for them. At Vijaipur, 62 overseen by the local CSR task Most of our operations are force comprising we provided computer located around remote dwellings infrastructure to Ekikrit Bal Vikash representatives of different having various developmental project at Raghogadh Dist. Guna departments. We have adopted needs like basic utilities, living to support computer education. In a structured agreement which is conditions, employment and other just over two years, we have signed with implementing socio-economic issues. GAIL has helped more than 314,000 families partner and covers in detail the extended its support towards through our activities under the commitments, work schedules, construction and renovation of theme ‘Community payment plans, etc. public utilities and infrastructure Development’.

Connectivity to villages by construction of roads at Pata, UP CONTRIBUTING TO COMMUNITY DEVELOPMENT

Drinking water / sanitation • Construction of toilets and We have continued our efforts to urinals near Pata unit in Auraiya increase the impact of our two A large part of rural India is striving district for availability of potable drinking flagship programs that have • Development of complete water for fulfilling its daily needs. scripted our success in CSR sanitation system in Tribal The scarcity of potable drinking endeavors over the years – ‘GAIL Authority of development water leads to use of unsafe Utkarsh’ and ‘E-Shiksha’. During hostel near our Abu Road unit. sources of water by a significant the year, we increased our work in proportion of India’s population Education / Literacy these two initiatives to enhance every day. Recognizing this issue at enhancement their impact and coverage across several places adjacent to our We believe that augmenting villages situated near our facilities. operational facilities, we have education infrastructure around us These programs, focused on undertaken several programs to to improve literacy rate can help in improve water infrastructure and IIT-JEE coaching and computer reducing unemployment to a availability. During the year, literacy respectively, aim to significant extent in economically projects were taken up across our develop capabilities that provide a backward regions in the country. operations for improving local strong footing to children to make We address this issue by employing hygiene and sanitation practices by their future brighter.GAIL is skill development and vocational construction of drains, provision of training programs and following continuing its efforts to enhance basic water infrastructure them up by creating livelihood the literacy infrastructure in including bore-wells, tube-wells, opportunities to facilitate vicinity of its facilities. In this hand-pumps, overhead tanks, and empowerment and regard, we are supporting water storage facilities. Some of socio-economic sustenance. During the major initiatives include: government schools situated in the year, we set up 100 non-formal rural areas in construction of class 63 • Provision of drinking water to education centers for rooms, laboratories, libraries, 37 Gram Panchayats at slum-dwelling children in the NCR hostels, toilets etc. We have also Nasirabad through pump sets under our program ‘Padho aur collaborated with other oil sector and bore wells Badho’. While we have covered • Installation of 100 hand pumps nearly 3000 students till date, we PSEs for setting up of an Institute in villages near GAIL have taken up a five-year period for of Petroleum Technology in installations in Agra district the project to cover 5000 students. Assam.

Developing water infrastructure: GAIL has taken initiatives to ensure availability of water across our installations. “E-Shiksha” - Supporting “GAIL Utkarsh” – Catapulting Environment protection education in nearby villages at rural children to crack Vijaipur and Pata entrance examinations Our efforts in environment protection are not limited to our E-Siksha program is one of our IIT-JEE and AIEEE are the most operations alone. We have most important programs under difficult entrance examinations in extended this responsibility to the the education theme. We have set the country, offering thousands of communities we operate in by up computer labs in self-sustained students a window to study at the supporting or developing power-equipped mobile vehicles prestigious IITs and NITs. environmental infrastructure. with qualified instructors and Coaching for these entrance Across our operations, we have teaching aids. These are used as a examinations is very popular in provided more than 1000 solar teaching computer aid for students India, especially in the urban lights in rural areas which are with regular computer school areas. However, such coaching experiencing acute electricity curriculum and adults to take up a classes are usually inaccessible to shortage. We have collaborated course in typing and basic the rural population as there is a with CEL, Tata BP Solar and other computer literacy with the lack of coaching centres in these experts in solar products in this assistance of a trained instructor. areas and their fee is generally not regard. Most of the areas of our This program has been affordable. GAIL initiated its plant locations face issues related implemented on a pilot basis in ‘GAIL-Utkarsh’ project to help to water management. During the Vijaipur and Pata units. The major deserving students living in year, we have undertaken several benefit accrued through this economically backward villages in projects to improve water initiative is an increased awareness getting equitable chance to get infrastructure for communities on computers and technology in into the IITs/NITs by providing through rainwater harvesting and nearby villages. Additionally, our them free residential coaching for groundwater reuse, construction NGO partner awards certificate of such exams. At the end of the of check dams etc. completion to successful reporting period, we had helped candidates, the courses for which 65 economically disadvantaged GAIL has been a firm supporter of 64 are registered with the Ministry of students successfully compete in wildlife protection projects. We HRD. This has helped many engineering entrance contributed vehicles for ‘Save the successful candidates in getting examinations. In FY 2010-11, Tiger’ Project in Malenad-Mysore employment with local eight students cracked IIT-JEE Tiger conservation area, along contractors as clerks or book 2011,3 ISRO and 36 for with the construction of a Field keepers. Over the last three-four NITs/UPTU - a remarkable feat Research Center at years, this program has helped for our initiative. Encouraged by Melinahuluwathi, Bhadra Wild nearly 2500 youth in enhancing this result, we have taken a target Reserve (implemented through computer literacy and augmenting to reach out to 100 students in FY Centre for Wildlife Studies, employment. 2011-12. Bangalore) and support to the

Power of Knowledge: GAIL’s e-Shiksha initiative under the education thrust area is focused on providing teaching aids, computer labs, mobile vehicles etc. CONTRIBUTING TO COMMUNITY DEVELOPMENT

Mobile Veterinary Service units rely on unpredictable monsoon programs. We have contributed running in the wildlife sanctuaries for crops and often had to migrate towards several initiatives of Manas National Park, through to earn livelihoods during the rest facilitating effective empowerment Wildlife Trust of India. During the of the year. The twin problems of and self-reliance. With the help of year, GAIL also undertook several water scarcity and migration our implementing partners, we other initiatives for environmental affected the development of these provide training on sewing and protection. These include villages. We realized the tailoring methods and devised development of gas-based importance of setting up desired computer-based visual speech crematorium in New Delhi and water infrastructure to boost programs for differently-abled installation of bio-gas plants for economic development in the people. A Skill Development poor slum-dwellers where GAIL region. Our interventions involved School has been set up in supplies gas. construction of check dams and partnership with IL&FS Clusters in water catchment areas adjacent to Infrastructure Guna, MP for imparting vocational our facility. This facilitated use and training to rural and semi-urban Lack of proper infrastructure is a reuse of water alongside providing youth. In the year under major issue faced by almost all the opportunities for pisci culture. reference, all 270 youth covered areas where our plants are Farmers in these beneficiary under this flagship programme located. While we have developed villages are using the water from have been successfully placed in our facilities we have done the check dams for agriculture and the jobs. infrastructure development in animal husbandry. We have those areas through our village experienced a decline in migration Project ‘Swavalambh’ – GAIL adoption programs, construction of village youth for work during –IL&FS Skill school - imparting of Anganwadi buildings, non-monsoon months. skill training to unemployed constructing community centres youth Skill development / to support rural cultural festivities Empowerment GAIL initiated its flagship program 65 and by building adequate road ‘Swavalambh’ in 2010 along with infrastructure. Skill development has always been IL&FS Skill School to enhance skills considered one of the most Developing water and increase employment of the powerful tools to boost infrastructure near Vijaipur unemployed youth in rural areas. development, and GAIL is This program is aimed to target consistently working towards Villages around our facility in people who are conventionally sound skill enhancement Vijaipur, Madhya Pradesh, had to disadvantaged with regard to skill development, including school drop-outs, undergraduate students with low marks, women, and other academically less-oriented and disadvantaged groups. In a course spanning six to eight weeks, GAIL trains candidates in retail and facility management and provided basic knowledge in computers. This course enables candidates to have higher computer literacy together with increased employability to cater to demand in the retail and facility management sectors. During the year, 270 youths successfully Empowering aspirations: GAIL has consistently worked on enhancing the skill set completed the training program of the individual by providing training on sewing and tailoring. and were successfully placed. Supporting MoRD in skill enhancement programs The Ministry of Rural Development (MoRD) initiated the Swarna Jayanti Gram Swarozgar Yojana (SGSY) to promote employment in rural areas in India. GAIL has supported this scheme through the GAIL-Aroh Skill resource training center. The program, executed under a PPP model with the MoRD, aims at Healing hands: One of the flagship programmes initiated under thrust area of Healthcare providing non-formal education to was mobile healthcare vehicle in remote areas providing basic medical services. school drop-outs in rural areas in Delhi and NCR, additionally giving development of healthy living surrounding communities focusing them basic education, quality care, conditions for them. Our efforts on several healthcare themes and moral upliftment. About 7000 are concentrated on health including reconstructive surgery youth have been covered under programs dealing with serious for leprosy patients, cataract this project. We aim to increase diseases that are prevalent in the operations, cancer screening, TB the impact and reach of the Aroh affected areas. GAIL has helped to eradication, malaria treatment, program by boosting the set up telemedicine centers at family planning and free infrastructure to run these several district headquarters distribution of medicines. Hospitals programs. This will enable us to situated in vicinity of its facilities. and dispensaries located in our reach out to more children and These centers are linked to major other academically disadvantaged medical institutes and research townships also extend medical sections of the society. Our efforts centers and are instrumental in care and treatment to the local in this program have led to providing treatment as well as villagers. We have extended our 66 three-fold benefits for the target training services. These health campaign for the benefit of children: telemedicine centers conduct external communities as well. As a • Improving the quality of regular health camps covering part of our societal commitments, education through adequate large number of serious diseases we conduct medical camps and training provided to teachers including cancer, thalassemia, TB, checkups for diseases such as and overhauling of curriculum malaria, etc. Apart from these, we diabetes, hypertension and cardio • Contributing to change in have regular programs in our vascular ailments. attitude and developing trust in education amongst communities who were traditionally resistant to education • Creating a comfortable environment for women to participate in the system, thereby providing access to education to them Healthcare / Medical Along with education and infrastructure, healthcare is one of the significant areas for focusing developmental efforts in the country. We have invested in programs aimed at upgrading health infrastructure in marginal For a healthier future: We have been regularly conducting health awareness camps sections of the society to enable covering a wide range of ailments and diseases. CONTRIBUTING TO COMMUNITY DEVELOPMENT

Managing social impacts during land. During the planning stage, who can re-use the land for pipeline network expansion we conduct an extensive cultivation. In this regard, we fully and operations engagement exercise with local protect the farmers’ / land communities along with a owners’ interest. GAIL has the largest Natural Gas competent authority which is on pipeline network in India spread deputation from the state Apart from acquiring RoU, small over diverse geographic regions. government to identify and stretch of permanent land is also While we extend our network to communicate concerns from acquired for installing reach out to more regions and farmers/land owners to the Sectionalizing Valve and customers, we also fulfill our Government for seeking their Intermediate Pigging Stations as responsibility towards the approval. GAIL pays compensation per the norms approved by the communities that live adjacent to for presumptive crops during the Board of Directors that appoints a our pipelines, on which these entire pipeline construction period multidisciplinary committee of operations have the maximum up to satisfactory restoration of Senior Executives to negotiate impact. the fields. After completion of with the land owner for the pipeline construction, the RoU is permanent land acquisition based A typical pipeline requires Right of restored to the satisfaction of the on the latest market rate in the Way for the land under which farmer / land owner. To ensure area for which the land was last pipeline is to be laid. Placing strong preservation of communities’ registered. The acquisition takes focus on compliance and our interests and allay their concerns place after the rate is mutually commitment towards with respect to our operations, agreed between the owner and communities, we acquire Right of GAIL holds 5% payment of the GAIL. Thus rigorous public Way for land under which pipeline contracts involved in pipeline consultation is one of the key is to be laid. As per statutory construction and releases the procedures that is stringently norms, we obtain RoU (Right of amount only after obtaining the followed during the pipeline 67 Use) for 15 to 30 meters wide NoC from the farmer/land owner construction lifecycle.

A snapshot of GAIL’s various social responsibility initiatives ASSURANCE STATEMENT

GAIL (India) Ltd. has principles of Global Reporting commissioned Emergent Ventures Initiative G3 Guidelines. India Private Ltd. to undertake an independent assurance of its 2. Evaluation of the reliability of Corporate Sustainability Report specified sustainability for the year 2010-11. The performance information for assurance process has been the period April 2010 to conducted in accordance with March 2011. Corporate Head Quarter in AA1000AS (2008). The assurance Our Approach Delhi and GAIL Training principles of Inclusivity, Materiality The assurance engagement was Institute (GTI), Noida. and Responsiveness, as outlined in planned and carried out in January 2. Interviews: In addition to AA1000AS (2008), and GRI 2006 2012. Our assurance team, led by interviewing data owners at (GRI G3) guidelines have been a Certified Sustainability the sites we visited, we also used as criteria against which to Assurance Practitioner (CSAP), interviewed a representative evaluate the Report. comprised of professionals having set of people from the senior prior demonstrable experience in The intended users of this management to understand the the domain of sustainability and process of stakeholder assurance statement are the climate change. Our conclusions engagement and materiality readers of GAIL’s Sustainable are based on a review of determination at GAIL. Development Report 2010-11. processes & practices for Processes and systems for The management of GAIL is identification and collation of engagement with selected responsible for engagement with relevant information, report stakeholders were reviewed. stakeholders, identification of content and performance data, material issues and the collection which included a review of the 3. Data Accuracy Checks: The and presentation of the stakeholder engagement and information disclosed under information contained in the materiality determination process different indicators in the report. In performing the followed by GAIL. Relevant report was verified by way of assurance activities, EVI’s documentation, our observations responsibility is to the collection and corroborating it 68 with respect to process and with the source of the management of GAIL only and in systems in place and interaction accordance with the terms of information. We have relied on with respective departments a sample of various documents reference agreed with the engaging with different company. We do not therefore and sources like internal SAP stakeholders have formed the system, invoices, work orders, accept or assume any basis of our assurance on the responsibility to a third party’s reports submitted to principles of Inclusivity, Materiality regulatory bodies, utility bills, decisions, whether investment or and Responsiveness required for otherwise, made on the basis of inter departmental assurance under AA1000AS communication etc. as well as this assurance statement. EVI was (2008). not involved in the preparation of on-site inspection and any statement or data included in We undertook the following key observations. In certain places the report except for this steps: where we had to rely on assurance statement, thus company’s internal 1. Site Visits: The EVI team documentation we have tried maintaining complete visited a representative set of independence and impartiality. cross verification from two GAIL’s facilities comprising of different sources in order to Scope of Assurance four gas processing plants minimize the chances of EVI has been engaged to provide (Pata, Vijaipur, Vaghodia, oversight. Type 2 Moderate level of Gandhar), one petrochemical assurance as set out in AA1000AS plant (Pata), two gas The verification of company’s (2008). The scope of the compressor stations financial performance or assurance includes the following: (Vaghodia, Vijaipur) and one information provided in the LPG pumping station economic section in the report 1. Evaluate the adherence to the (Mansarampura) to evaluate was derived directly from the AA1000APS (2008) principles the source of data as well and audited annual report publicly of inclusivity, materiality and interview data owners. We available on GAIL’s official website responsiveness and the also made visits to the (www.gailonline.com). ASSURANCE STATEMENT

Limitations and Exclusions departments engage regularly with notice the following observations 1. Scope of assurance is limited their relevant stakeholders and recommendations for the to the boundary defined in the through multiple engagement report: report and the period of 1st channels. However, GAIL could • GAIL has done a commendable April 2010 to 31st March consider the incorporation of job at stakeholder engagement 2011. special sustainability related process with its key 2. Assurance is subject to no modules in the existing stakeholder group - physical verification of things communication channels with its Employees. The same process like inventory of material stakeholders to improve their could be expanded to include consumed, waste generated, sustainability awareness. the other stakeholders emissions and effluents etc. groups as well. Materiality: GAIL has followed a Assurance relied on the • Few of the plants of GAIL have structured process of materiality documentation maintained by implemented an internal determination. The process could the company or provided to verification mechanism for further be improved by the company by another third improving the reliability of incorporating the viewpoints of party. performance data and the stakeholders other than 3. The scope of assurance does same could be replicated at the employees as well. Based on our not cover the statements in remaining facilities as well. scope of work and the activities the report that describe • GAIL should further strengthen undertaken for the purpose like companies approach, strategy, system(s) for data capturing site visits, interactions and aim, expectation, aspiration or and managing information so as observations, we have not come beliefs or intentions. to increase the number of across any material aspect of reported key performance Conclusion sustainability performance that has indicators. Special attention Based on our review we have been excluded from the report. needs to be given to the social come to the following conclusions: Responsiveness: Based on our performance indicators to In our opinion, GAIL’s first observation, interviews and increase the coverage and 69 sustainability report gives an documentation we believe that reliability of reported appropriate representation of the GAIL has adequately applied the information. sustainable development initiatives principle of responsiveness with undertaken in the company. The For Emergent Ventures India respect to its stakeholders. The Private Ltd. report does a fairly good job of work is delegated to appropriate identifying the material aspects for departments who engage, collect the company, collecting views and identify material issues performance data for majority of of respective stakeholders and its facilities and reporting the then devise action plan to address information in adherence to the those issues. We have not come principles of GRI G3 guidelines and across any material evidence that Sanjay Dube Oil and Gas Industry Guidance on would lead us to believe that Vice President - Sustainability and Voluntary Sustainability Reporting responsiveness principle is not (2005) from International Climate Value Advisory being adequately applied in dealing Emergent ventures India Private Petroleum Industry Environmental with the stakeholders. Conservation Association (IPIECA) Ltd. and the American Petroleum GRI G3 Guidelines: Based on the Gurgaon, 31st of Jan, 2012 Institute (API). information in the report and the independent assurance sought Our conclusion on the adherence from us we have found that the of the three principles under company meets the requirement AA1000APS (2008) is as follows: of B+ level of reporting as Inclusivity: We have not come specified by GRI G3 guidelines. across any material evidence that Observations and would lead us to conclude that Recommendation GAIL has not applied the principle Without affecting our overall of inclusivity in engaging with its conclusions on the sustainability stakeholders. Different report, we would like to bring to GLOSSARY

AIEEE All India Engineering DIN Dutch Institute fur IEM Independent External Entrance Examination Normung Monitors API American Petroleum EVI Emergent Ventures India IIT-JEE Indian Institute of Institute Private Limited Technology - Joint Entrance Examination ASME American Society of EPA Environmental Mechanical Engineers Protection Agency INR Indian National Rupee BPCL Bharat Petroleum ED Executive Director ISTD Indian Society of Training Corporation Limited and Development E&P Exploration and BOG Boiled Off-Gas Production ISRO Indian Space Research Organization BCPL Brahmaputra Cracker & FICCI Federation of Indian IGL Indraprastha Gas Limited Polymer Limited Chambers of Commerce BD Business Development and Industry IT Information Technology CS Carbon Steel FY Financial Year IL&FS Infrastructure Leasing and Financial Services CPCB Central Pollution Control GTI GAIL Training Institute Board IMS Integrated Management GPU Gas Processing Unit System CPSE Central Public Sector Enterprise GREP Gas Rehabilitation and ISO International Expansion Project Organization for CVC Central Vigilance Standardization Commission GM General Manager IPIECA International Petroleum GJ Giga-Joule CMD Chairman and Managing Industry Environmental 70 Director GRI Global Reporting Conservation Association Initiative CFC Chloro-fluoro Carbons JLPL Jamnagar Loni Pipe Line GHG Green-house Gas CGD City Gas Distribution JNNSM Jawaharlal Nehru CBM Coal Bed Methane GSPC Gujarat State Petroleum National Solar Mission Corporation CRZ Coastal Regulation Zone JV Joint Ventures HVJ Hazira-Vijaipur- km Kilo-meters CAGR Compounded Annual Jagdishpur Growth Rate KG Krishna-Godavari HSE Health, Safety and CNG Compressed Natural Gas Environment LPG Liquefied Petroleum Gas CII Confederation of Indian HSEMS Health, safety and LHC Liquid Hydro Carbon Industry environment LLDPE Linear Low Density CSR Corporate Social management system Poly-Ethylene Responsibility HRSG Heat recovery steam LP Low Polymer CSI Customer Satisfaction generator Index MDP Management HDPE High Density Development Programs DVPL Dahej-Vijaipur Pipe Line Poly-Ethylene MBA Masters of Business DGM Deputy-General Manager HR Human Resources Administration DGH Directorate-General of HRD Human Resources MoU Memorandum of Hydrocarbons Development Understanding GLOSSARY

MT Metric Tons NOx Oxides of nitrogen Data Acquisition

MMSCMD Million Metric SOx Oxides of sulphur SPM Suspended Particulate Standard Cubic Meter Matter ODS Ozone Depleting per Day Substances SD Sustainable Development MoEF Ministry of Environment PESO Petroleum and Explosive SGSY Swarna Jayanti Gram and Forests Safety Organization Swarozgar Yojana MoP&NG Ministry of PNGRB Petroleum and Natural TISS Tata Institute of Social Petroleum and Natural Gas Regulatory Board Sciences Gas PCRA Petroleum Conservation TERI The Energy and MoRD Ministry of Rural Research Association Resources Institute Development PPAC Petroleum Planning and TMT Thousand Metric Tons MFO Mixed Fuel Oil Analysis Cell tCO e Tons of Carbon Dioxide NCR National Capital Region 2 PNG Piped Natural Gas equivalent NH National Highways P/L Pipeline TPA Tons per Annum NIT National Institute of PCB Pollution Control Board TDS Total Dissolved Solids Technology PUC Pollution Under Control TI Transparency NG Natural Gas International PE Poly-Ethylene NELP New Exploration TB Tuberculosis Licensing Policy PAT Profit After Tax TAPI Turkmenistan- 71 NGO Non-Government PPP Public Private Partnership Afghanistan- Pakistan- Organizations RGIPT Rajiv Gandhi Institute of India NoC No objection Certificate Petroleum Technology UNGC United Nations Global NRL Numaligarh Refinery RGPPL Ratnagiri Gas and Power Compact Limited Private Limited US United States OHSAS Occupational Health and RLNG Re-gasified Liquid Natural USD United States Dollar Safety Assessment Gas Series UP Uttar Pradesh R&D Research and OIC Officer-in-Charge Development UPTU Uttar Pradesh Technical University ONGC Oil and Natural Gas RoU Right of Use Corporation VHP Very High Pressure RTI Right To Information OIL Oil India Limited VSPL Vizag-Secundrabad Pipe SC Scheduled Castes OISD Oil Industry Safety Line Directorate ST Scheduled Tribes OMC Oil Marketing Companies SMDC Senior Management Development Center O&M Operation and Maintenance SBP Special Boiling Point OFC Optical Fibre Cable SH State Highways OBC Other Backward Classes SCADA Supervisory Control and GRI CONTENT INDEX

Indicator Page Description Reported Remarks (if any) reference reference 1. Strategy and Analysis Statement from the most senior decision -maker of the 1.1 Fully 3 organization. 1.2 Description of key impacts, risks, and opportunities. Fully 36,37 2. Organizational Profile Front 2.1 Name of the organization. Fully cover 2.2 Primary brands, products, and/or services. Fully 17,18 Operational structure of the organization, including main Please refer to page 20, 21, 28, 29 of our Annual report at 2.3 divisions, operating companies, subsidiaries, and joint Fully 17,18 http://gailonline.com/final_site/pdf/GAIL_AR_2010_11.pdf ventures. Back 2.4 Location of organization's headquarters. Fully cover Number of countries where the organization operates, and All operations under GAIL's full control (100% ownership) names of countries with either major operations or that are are in India. GAIL also operates through subsidiaries and JV's 2.5 Fully - specifically relevant to the sustainability issues covered in the outside India. Additional information on coverage of report. operations in the report is given on page 17 - 18 GAIL is a government -owned Public Sector Undertaking, 2.6 Nature of ownership and legal form Fully - listed on the BSE NSE and LSE Markets served (including geographic breakdown, sectors 2.7 Fully 9-14 served, and types of customers/beneficiaries). Please refer to page 23 of our Annual report at 2.8 Scale of the reporting organization. Fully 17-18 http://gailonline.com/final_site/pdf/GAIL_AR_2010_11.pdf Significant changes during the reporting period regarding There were no significant changes in the reporting period in 2.9 Fully - size, structure, or ownership. operations owned and controlled by GAIL 2.10 Awards received in the reporting period. Fully 21 3. Report parameters Reporting period (e.g., fiscal/calendar year) for information 3.1 Fully 2 provided. Not 72 3.2 Date of most recent previous report (if any). - Not applicable as this is GAIL’s first report reported 3.3 Reporting cycle (annual, biennial, etc.) Fully 2 Contact point for questions regarding the report or its Inside 3.4 Fully contents. back cover 3.5 Process for defining report content. Fully 33-35 Boundary of the report (e.g., countries, divisions, 3.6 subsidiaries, leased facilities, joint ventures, suppliers). See Fully 2 GRI Boundary Protocol for further guidance. State any specific limitations on the scope or boundary of the 3.7 Fully 2 report (see completeness principle for explanation of scope). Basis for reporting on joint ventures, subsidiaries, leased facilities, outsourced operations, and other entities that can 3.8 Fully 2 significantly affect comparability from period to period and/or between organizations. Data measurement techniques and the bases of calculations, including assumptions and techniques underlying estimati ons 3.9 applied to the compilation of the Indicators and other Fully 2 information in the report. Explain any decisions not to apply, or to substantially diverge from, the GRI Indicator Protocols. Explanation of the effect of any re -statements of information provided in earlier reports, and the reasons for such re - Not 3.10 - Not applicable as this is GAIL’s first report statement (e.g. mergers/acquisitions, change of base reported years/periods, nature of business, measurement methods). Significant changes from previous reporting periods in the Not 3.11 scope, boundary, or measurement methods applied in the - Not applicable as this is GAIL’s first report reported report. Table identifying the location of the Standard Disclosures in 3.12 Fully 72-77 the report. Policy and current practice with regard to seeking external 3.13 Fully 2,68,69 assurance for the report. GRI CONTENT INDEX

Indicator Page Description Reported Remarks (if any) reference reference 4. Governance, Commitments and Engagements Governance structure of the organization, including committees under the highest governance body responsible Please refer to page 43, 44, 45, and 46 of our Annual report 4.1 Fully 23-24 for specific tasks, such as setting strategy or organizational at http://gailonline.com/final_site/pdf/GAIL_AR_2010_11.pdf oversight. Indicate whether the Chair of the highest governance body is 4.2 Fully - Our Chairman is also an executive officer also an executive officer. For organizations that have a unitary board structure, state Please refer to page 43 of our Annual report at 4.3 the number of members of the highest governance body that Fully - http://gailonline.com/final_site/pdf/GAIL_AR_2010_11.pdf are independent and/or non -executive members. Minority shareholders can give their recommendations to the Board during Annual General Meeting of the Company Mechanisms for shareholders and employees to provide being held every year and also on designated e-mail id of 4.4 recommendations or direction to the highest governance Fully - the Company - investorqueries@gail.co.in body. Independent Directors are appointed Government of India to take care of interest of all stakeholder including minority shareholders. The remuneration of whole-time Directors is determined by Linkage between compensation for members of the highest the President of India, through Ministry of Petroleum & governance body, senior managers, and executives Natural Gas. The compensation includes performance - 4.5 (including departure arrangements), and the organization's Fully - linked incentive that is based on performance parameters, performance (including social and environmental viz. performance at corporate, unit and individual levels. performance). These performance parameters, among others, include sustainability performance as well As per provision of the Companies Act, 1956 all matters are usually required to be approved by majority of Directors Processes in place for the highest governance body to 4.6 Fully - except certain items which is required to be approved with ensure conflicts of interest are avoided. unanimous consent of the Board viz. inter-corporate loan, investment, guarantees etc. Whole-time Directors are selected by Public Enterprises 73 Selection Board (PESB) and appointed by Ministry of Petroleum & Natural Gas. Part-time Government Nominee Process for determining the qualifications and expertise of Directors are appointed by Ministry of Petroleum & Natural the members of the highest governance body for guiding the 4.7 Fully - Gas, Government of India. Independent Directors organization's strategy on economic, environmental, and representing the interest of public at large and all social topics. stakeholders are selected by SearchCommittee and appointed by President of India, acting through Ministry of Petroleum & Natural Gas, Government of India. Internally developed statements of mission or values, codes of conduct, and principles relevant to economic, 4.8 Fully 1 environmental, and social performance and the status of their implementation. Procedures of the highest governance body for overseeing the organization's identification and management of economic, environmental, and social performance, including 4.9 Fully 25-26 relevant risks and opportunities, and adherence or compliance with internationally agreed standards, codes of conduct, and principles. Processes for evaluating the highest governance body's own Additionally, please refer to page 43, 44 of our Annual report 4.10 performance, particularly with respect to economic, Fully 23-24 at http://gailonline.com/final_site/pdf/GAIL_AR_2010_11.pdf environmental, and social performance. Explanation of whether and how the precautionary approach The use of precautionary approach is implicit in our risk 4.11 Fully 25 or principle is addressed by the organization. management framework Externally developed economic, environmental, and social 4.12 charters, principles, or other initiatives to which the Fully 79 organization subscribes or endorses. Memberships in associations (such as industry associations) and/or national/international advocacy organizations in which the organization: * Has positions in governance bodies; * 4.13 Fully 79 Participates in projects or committees; * Provides substantive funding beyond routine membership dues; or * Views membership as strategic. Indicator Page Description Reported Remarks (if any) reference reference 4.14 List of stakeholder groups engaged by the organization. Fully 29-31 Basis for identification and selection of stakeholders with 4.15 Fully 29 whom to engage. Approaches to stakeholder engagement, including frequency 4.16 Fully 29-31 of engagement by type and by stakeholder group. Key topics and concerns that have been raised through stakeholder engagement, and how the organization has 4.17 Fully 29-31 responded to those key topics and concerns, including through its reporting. Disclosures on Management Approach DMA -EC Disclosure on management approach -economic Fully 5-7 DMA -EN Disclosure on management approach -environmental Fully 5-7 DMA -HR Disclosure on management approach - human rights Fully 5-7 Disclosure on management approach - labor practices and DMA -LA Fully 5-7 decent work DMA -PR Disclosure on management approach - product responsibility Fully 5-7 DMA -SO Disclosure on management approach -societ y Fully 5-7 Performance indicators –Economic Direct economic value generated and distributed, including revenues, operating costs, employee compensation, EC1 donations and other community investments, retained Fully 39 earnings, and payments to capital providers and governments. We are currently in the process of enhancing our systems to Financial implications and other risks and opportunities for Not EC2 - quantify financial implications from climate change risks and the organization's activities due to climate change. reported opportunities Coverage of the organization's defined benefit plan EC3 Fully 39-40 obligations. There was no financial assistance received from the 74 EC4 Significant financial assistance received from government. Fully - government Range of ratios of standard entry level wage compared to Not We are in the process of enhancing our monitoring and data EC5 - local minimum wage at significant locations of operation. reported management systems to track this information Policy, practices, and proportion of spending on locally-based Partially There is no explicit policy on preference of locally-based EC6 40 suppliers at significant locations of operation. reported suppliers. Procedures for local hiring and proportion of senior Recruitment at the Executive/ Officer cadre is done only at EC7 management hired from the local community at significant Fully - all India bases, and not at local level locations of operation. Development and impact of infrastructure investments and EC8 services provided primarily for public benefit through Fully 41 commercial, in-kind, or pro bono engagement. Understanding and describing significant indirect economic EC9 Fully 62-67 impacts, including the extent of impacts. Performance indicators –Environmental EN1 Materials used by weight or volume. Fully 45 Percentage of materials used that are recycled input EN2 Fully 45 materials. EN3 Direct energy consump tion by primary energy source. Fully 43 EN4 Indirect energy consumption by primary source. Fully 43 Energy saved due to conservation and efficiency EN5 Fully 43 improvements. Initiatives to provide energy-efficient or renewable energy EN6 based prod ucts and services, and reductions in energy Fully 43 requirements as a result of these initiatives. Initiatives to reduce indirect energy consumption and Not Currently GAIL does not monitor reductions achieved from EN7 - reductions achieved. reported initiatives avoiding indirect energy use EN8 Total water withdrawal by source. Fully 47 Our operations do not have significant impact on nearby EN9 Water sources significantly affected by withdrawal of water. Fully - water sources. GRI CONTENT INDEX

Indicator Page Description Reported Remarks (if any) reference reference EN10 Percentage andtotal volume of water recycled and reused. Fully 47 Location and size of land owned, leased, managed in, or Not EN11 adjacent to, protected areas and areas of high biodiversity - reported value outside protected areas. Description of significant impacts of activities, products, and Not EN12 services on biodiversity in protected areas and areas of high - reported biodiversity value outside protected areas. EN13 Habitats protected or restored. Fully 46 Strategies, current actions, and future plans for managing Not EN14 - impacts on biodiversity. reported Total direct and indirect greenhouse gas emissions by EN16 Fully 44 weight. Not Currently we are in the process of developing monitoring EN17 Other relevant indirect greenhouse gas emissions by weight. - reported mechanisms to track Scope 3 emissions Initiatives to reduce greenhouse gas emissions and EN18 Fully 44 reductions achieved. EN19 Emissions of ozone-depleting substances by weight. Fully 44 NOx, SOx, and other significant air emissions by type and EN20 Fully 44 weight. EN21 Total water discharge by quality and destination. Fully 47 Partially Currently we are in the process of improving our monitoring EN22 Total weight of waste by type and disposal method. 45 reported & reporting mechanisms for non-hazardous wastes Not Currently we are in the process of developing monitoring EN23 Total number and volume of significant spills. - reported mechanisms to track and report our significant spills Weight of transported, imported, exported, or treated waste deemed hazardous under the terms of the Basel Convention EN24 Fully - We do not transport any hazardous waste internationally Annex I, II, III, and VIII, and percentage of transported waste shipped internationally. 75 Identity, size, protected status, and biodiversity value of water There is no significant impact of our wastewater discharges EN25 bodies and related habitats significantly affected by the Fully - and run-offs to water bodies located in the vicinity of our reporting organization's discharges of water and runoff. operations Initiatives to mitigate environmental impacts of products and EN26 Fully 57-59 services, and extent of impact mitigation. This is not applicable for our gas transmission businesses. Percentage of products sold and their packaging materials Not EN27 - However, for the petrochemicals we do not reclaim any that are reclaimed by category. reported packaging material Monetary value of significant fines and total number of non - There were no such fines or sanctions during the reporting EN28 monetary sanctions for non-compliance with environmental Fully - period laws and regulations. Significant environmental impacts of transporting products Currently we are in the process of developing monitoring Not EN29 and other goods and materials used for the organization's - mechanisms to track environmental impacts of our logistics reported operations, and transporting members of the workforce. operations Total environmental protection expenditures and investments EN30 Fully 41 by type. Performance indicators –Human Rights Percentage and total number of significant investment Standard business agreementscontains stipulations for HR1 agreements that include human rights clauses or that have Fully - Prohibition of engagement of child labour, Payment of undergone human rights screening. Minimum Wages, and Compliance of other Labour Laws. No specific screening is done for contractors on human Percentage of significant suppliers and contractors that have rights. However the Engineers in Charge at work centres HR2 Fully - undergone screening on human rights and actions taken. ensure that Labour Legislations is adhered to. No Violations have been reported during the reporting year Total hours of employee training on policies and procedures Not We are in the process of devising training programs focused HR3 concerning aspects of human rights that are relevant to - reported on human rights operations, including the percentage of employees trained. There has been no incident of discrimination on grounds of race, color, sex, religion, political opinion, national HR4 Total number of incidents of discrimination and actions taken. Fully - extraction, or social origin has been reported during the assessment period Indicator Page Description Reported Remarks (if any) reference reference Though there has not been a formal/ specific initiative to Operations identified in which the right to exercise freedom of identify such operations, there is no operation which runs HR5 association and collective bargaining may be at significant Fully - such a risk to the right to exercise freedom of association risk, and actions taken to support these rights. and collective bargaining. There is no incident of engagement of Child Labour has Operations identified as having significant risk for incidents of been reported in the reporting period. The Engineer in HR6 child labor, and measures taken to contribute to the Fully - Charge (EIC) ensures relevant statutes are complied with. elimination of child labor. Prohibition to engage Child Labour is the standard C&P Clause. Though there has not been a formal/ specific initiative to Operations identified as having significant risk for incidents of identify such operations, no incident of engagement of HR7 forced or compulsory labor, and measures to contribute to the Fully - forced or compulsory labor has been reported in the elimination of forced or compulsory labor. assessment year. The Engineer in Charge (EIC) ensures relevant statutes are complied with. Percentage of security personnel trained in the organization's No training programs concerning human rights are Not HR8 policies or procedures concerning aspects of human rights - conducted for security personnel or third party organizations reported that are relevant to operations. providing security personnel. Our operations are not located in vicinity of indigenous Total number of incidents of violations involving rights of HR9 Fully - people and do not have significant impact on any such indigenous people and actions taken. section of the society Perfo rmance indicators –Labor practices and decent work Total workforce by employment type, employment contract, Partially We are in the process of improving systems for tracking and LA1 49 and region. reported reporting man-hours worked by contractual labor Total number and rate of employee turnover by age group, LA2 Fully 49 gender, and region. Benefits provided to full-time employees that are not provided GAIL provides Provident Fund, Gratuity, Superannuation, LA3 Fully - to temporary or part-time employees, by major operations. performance incentive, etc. Percentage of employees covered by collective bargaining All Workmen, which constitute 23.5% of total employee LA4 Fully - agreements. strength, are covered by collective bargaining agreement Minimum notice period(s) regarding significant operational We adhere to Section 9A of Industrial Dispute Act 1947 and 76 LA5 changes, including whether it is specified in collective Fully - Schedule 4 for providing notice period regarding significant agreements. operational changes Percentage of total workforce represented in formal joint As at the end of FY 10-11, total 190 management and 110 management -worker health and safety committees that help LA6 Fully - non-management, or 7.7% of our total employees, were monitor and advise on occupational health and safety members of formal health and safety committees programs. Rates of injury, occupational diseases, lost days, and LA7 Fully 54 absenteeism, and number of work-related fatalities by region. Education, training, counseling, prevention, and risk-control LA8 programs in place to assist workforce members, their Fully 66-67 families, or community members regarding serious diseases. Health and safety topics covered in formal agreements with Not We are currently in the process of collating health and LA9 - trade unions. reported safety topics covered in unions across operations Average hours of training per year per employee by LA10 Fully 51 employee category. Programs for skills management and life long learning that Not Currently we do not have specific programs related to LA11 support the continued employability of employees and assist - reported lifelong learning them in managing career endings. Percentage of employees receiving regular performance and LA12 Fully 51 career development reviews. Composition of governance bodies and breakdown of Please refer to page 43 of our Annual report at LA13 employees per category according to gender, age group, Fully - http://gailonline.com/final_site/pdf/GAIL_AR_2010_11.pdf minority group membership, and other indicators of diversity. No discrimination based on gender is practiced for LA14 Ratio of basic salary of men to women by employee category. Fully - compensation in any work centers. Performance indicators –Product responsibility Life cycle stages in which health and safety impacts of Our health and safety assessments are focused on our products and services are assessed for improvement, and Not operations. We are in the process of expanding the PR1 - percentage of significant products andservices categories reported coverage of such assessments to identify health and safety subject to such procedures. impacts across the value chain of our products GRI CONTENT INDEX

Indicator Page Description Reported Remarks (if any) reference reference Total number of incidents of non-compliance with regulations and voluntary codes concerning health and safety impacts of There were no such incidents of non-compliance during the PR2 Fully - products and services during their life cycle, by type of reporting period outcomes. Type of product and service information required by Our petrochemicals product packages bear thelocation of PR3 procedures and percentage of significant products and Fully - the manufacturing facility, chemical composition and total services subject to such information requirements. weight as per Indian legislations. Total number of incidents of non-compliance with regulations There were no such incidents of non-compliance during the PR4 and voluntary codes concerning product and service Fully - reporting period information and labeling, by type of outcomes. Practices related to customer satisfaction, including results of PR5 Fully 58 surveys measuring customer satisfaction. Programs for adherence to laws, standards, and voluntary GAIL fully complies by the ASCI norms for advertising and PR6 codes related to marketing communications, including Fully - communication and works with ASCI-authorized media advertising, promotion, and sponsorship. agencies only Total number of incidents of non-compliance with regulations and voluntary codes concerning marketing communications, There were no such incidents of non-compliance during the PR 7 Fully - including advertising, promotion, and sponsorship by type of reporting period outcomes. Total number of substantiated complaints regarding breaches Not Customer privacy is not a material issue for our industry and PR8 - of customer privacy and losses of customer data. reported hence has not been reported Monetary value of significant fines for non -compliance with There were no such incidents of non-compliance during the PR9 laws and regulations concerning the provision and use of Fully - reporting period. products and services. Performance indicators –Societ y Nature, scope, and effectiveness of any programs and SO1 practices that assess and manage the impacts of operations Fully 61-62 on communities, including entering, operating, and exiting. Percentage and total number of business units analyzed for Corruption risks are covered under our vigilance procedures SO2 Fully 26-27 risks related to corruption. and risk management framework 77 All our employees are mandate d to go through the Code of Percentage of employees trained in organization's anti- Conduct and comply with it during their tenure. We currently SO3 Fully - corruption policies and procedures. do not have specific training programs on the Code of Conduct SO4 Actions taken in response to incidents of corruption. Fully 27 Public policy positions and par ticipation in public policy SO5 Fully 29-30, 79 development and lobbying. Total value of financial and in -kind contributions to political There were no financial or in -kind contributions to political SO6 Fully - parties, politicians, and related institutions by country. parties, etc. No actions were taken against GAIL since there were no Total number of legal actions for anti -competitive behavior, SO7 Fully - instances of anti -competitive behavior, anti -trust or anti-trust, and monopoly practices and their outcomes. monopolistic practices Monetary value of significant fines and total number of non - There were no such fines or sanctions during the reporting SO8 monetary sanctions for non -compliance with laws and Fully - period regulations.

Report Application Level CC+ BAB+ A+

Report on: Report on all criteria listed Same as requirement for 1.1 for Level C plus: Level B G3 Profile 2.1 - 2.10 1.2 Disclosures 3.1 - 3.8, 3.10 - 3.12 3.9, 3.13 OUTPUT 4.1 - 4.4 , 4.14 - 4.15 4.5 - 4.13, 4.16 - 4.17

Not Required Management Approach Management Approach G3 Management Disclosures for each disclosed for each Indicator Category Approach Indicator Category

Disclosures OUTPUT Standard Disclosures Report on a minimum of 20 Respond on each core G3 Report Externally Assured Externally Report Report Externally Assured Externally Report Report on a minimum of Assured Externally Report Performance Indicators, at and Sector Supplement* G3 Performance 10 Performance indicator with due regard Indicators & least one from each of: Indicators, including at economic, environment, to the materiality Sector Supplement least one from each of: Principle by either: a) OUTPUT human rights, labor, reporting on the indicator Performance Indicators social, economic, and society, product environment. or b) explaining the reason responsibility. for its omission. *Sector supplement in final version UNGC / IPIECA REFERENCE

API/IPIECA UNGC Report section Pages Remarks (if any) reference reference Vision and Mission 1 About the report 2 Chairman and Managing 3 Director’s message Our sustainability SOC-1, SOC-4, 5-7 approach SOC-7 GAIL – Revisiting the 8-21 journey Governing the way we ENV-6, H&S-1, Principle 7, Principle 7 - The use of precautionary approach is implicit in 22 -27 operate SOC-2, ECO-A2 Principle 10 our risk management framework Enhancing the trust of 28-31 our stakeholders SOC-A1 Materiality 32 -35 Our corporate strategy 36-37 SOC-3 - There was no financial assistance received from or Creating sustainable provided to the government or political parties 38-41 ECO -1 economic value ECO -2, ECO -3 - Please refer to our Annual report at http://gailonline.com/final_site/pdf/GAIL_AR_2010_11.pdf ENV-1, ENV-A2, ENV-A3, ENV-A4, Managing our Principle 8, 42-47 ENV-A5, ENV-3, ENV-2 – We do not discharge hydrocarbons to water environmental footprint Principle 9 ENV-4, ENV-A6, 11ENV-4 – Total gas flared from our operations during FY 10-11 ENV-5, ENV-A9 was 8995.59 MT SOC-A3 - Recruitment at the Executive/ Officer cadre is done only at all India bases, and not at local level 78 Principle 2, Principle 3, Principle 4, Principle 5 - Though there has not been a formal/ specific initiative to identify such operations, there is no operation which runs such a risk to the right to exercise freedom of association and collective Principle 1, bargaining, child labor, forced labor H&S-2, H&S-3, Principle 2, Principle 2 - There has been no incident of discrimination on Creating a better H&S-4, SOC-A2, Principle 3, grounds of race, color, sex, religion, political opinion, national 48-55 workplace SOC-5, SOC-6, Principle 4, extraction, or social origin has been reported during the SOC-9 Principle 5, assessment period Principle 6 Principle 1, Principle 6 - Standard business agreements contains stipulati ons for Prohibition of engagement of child labor, Payment of Minimum Wages, and Compliance of other Labor Laws. No specific screening is done for contractors on human rights. However the Engineers in Charge at work centers ensure that Labor Legislations is adhered to. No Violations have been reported during the reporting year H&S-5 – Our health and safety assessments are focused on Building value for our our operations. We are in the process of expanding the 56-59 H&S-5 Principle 9 customers coverage of such assessments to identify health and safety impacts across the value chain of our products Contributing to SOC-8, SOC-4A, 60-67 community development SOC-5A Assurance statement 68-69 Glossary 70-71 GRI Content Index 72 -77 The Year Ahead 79 THE YEAR AHEAD

developmental needs of the communities around us in a better way. This assessment will be beneficial in drawing our CSR plans for the coming years. We will continue to work with MoP&NG, DGH, PNGRB, OISD, PCRA, MoEF, PPAC, PCB & CPCB, PESO and industry associations like FICCI, CII, International Gas Union, Petrofed,World Energy Council on various issues in the energy sector. We are looking forward to CMD and Functional Directors becoming a signatory to the United Nations Global Compact As we gear up for the next year, of each plant to identify and also participate in the Global we look forward to further infuse opportunities for improvement Methane Initiative to better sustainability in the way we work. and preparation of action plans. In understand sustainability issues in We have initiated a drive across the coming year, we plan to our areas of operation and also GAIL to make our employees earmark a part of our profit after benchmark our efforts with our aware about the importance of tax specifically for sustainability global peers. Along with this we sustainability for GAIL and the way initiatives. Once approved, this also plan to continue our it is a part of our business strategy. will enable us to mobilize contribution towards policy 79 We will strive to involve more on-ground resources to ensure development through industry employees to adopt sustainable rapid action on our initiatives, associations and task forces of business practices and promote thereby ensuring a healthy return various Ministries. on investment. sustainability across all our We plan to actively interact with operations. Going forward, the strategic focus other leading companies to share In the coming year, we plan to of GAIL would be on augmenting best practices and building of release the final draft of our the renewable energy portfolio, framework in making Sustainability Sustainability Policy that will considerably reducing our carbon an integral plank of every facet of provide direction to our footprint. We also plan to initiate a our organization. In the year ahead, we look forward to take sustainability efforts in the years to pilot GHG accounting exercise at meaningful actions on our come. The plan also covers our Vijaipur plant during the year sustainability journey through creating a Board level to better understand the impact of these initiatives and maximize the sub-committee on sustainability our operations on climate change and delve upon methods to value that we create for ourselves headed by an Independent mitigate such emissions. In the and our stakeholders. Director, to regularly monitor our coming years, we will increase the sustainability initiatives and SD Team - Corporate scope of this exercise to assess performance. This committee will Planning Department our GHG emissions across our be supported by a steering operations and strategically work committee headed by Director towards reducing our carbon (BD) to plan, oversee and footprint. implement on-ground sustainability activities. The We have initiated an external steering committee will also have community needs assessment the responsibility of analyzing the exercise with the help of TISS sustainability performance trends across our sites to understand the TO BE DECIDED

GAIL SD Team thanks management, employees and other stakeholders who helped in bringing out this maiden SD report.

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GAIL looks forward to and seriously considers stakeholder feedback. Please send your feedback to: • Mr. Santanu Roy, General Manager (Corporate Planning) at [email protected] • Mr. Kamal Kishore Chatiwal, Dy. General Manager (Corporate Planning) at [email protected] GAIL (India) Ltd. GAIL Bhawan, 16, Bhikaiji Cama Place New Delhi – 110066 India. Web : www.gailonline.com Tel: +91 - 11 - 2617 2580