The explosion occurred near an Oil and Natural Gas Corporation (ONGC) refinery complex at Nagaram in East Godavari district.
GAIL chairman BC Tripathi said the reason for the accident is yet unknown.
The fire from the explosion reportedly spread to nearby houses, shops and coconut plantations.
As many as 20 fire engines rushed to the site and brought the flames under control.
Rescue operations are underway while the death toll is expected to rise,said reports.
Prime Minister Narendra Modi has condoled the loss of lives in the fire in the GAIL pipeline in Andhra Pradesh.
"My thoughts with the families of those who lost their lives in the GAIL Pipeline fire in AP. Prayers with the injured," Modi tweeted.
"I have spoken to the Petroleum Minister, Cabinet Secretary & GAIL Chairman and asked them to ensure immediate relief at the accident site," he posted on micro-blogging site Twitter.
Andhra Pradesh Chief Minister N Chandrababu Naidu said he has ordered an inquiry into the incident.
"My condolences to the families who lost their loved ones in East Godavari blast. Ordered an enquiry & action plan to avoid these in future," tweeted Naidu.
"Asked Dy CM Chinarajappa to go to the ONGC pipeline blast site and provide required support. We need a preventive plan to ensure safety," he said.
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