Compressor inlet air cooling is one of the most well-known methods to improve gas turbine power plant performance. In this study, pressure reduction valve in natural gas pressure reduction station is replaced by a turbo-expander to use the potential energy of the compressed gas. The turbo-expander shaft is connected to a mechanical chiller to produce refrigeration; the produced refrigeration is used to decrease the compressor inlet air temperature. Moreover, thermodynamic and exergetic analyses are carried out and the effect of compressor air cooling on the performance of the plant is studied. To do so, Montazer Ghaem power plant is considered as the case study. Results showed that using cooling system causes 3.2% temperature drop which leads to 1.138% increment in both thermal efficiency and net output power in the warmest month. Exergetic analysis reveals that using the cooling system leads to a higher exergy efficiency and hence lower exergy destruction. Also combustion chamber with 81.26 MW has the highest amount of exergy destruction which decreases to 77.36 MW after implementation of the cooling system. In January, exergetic efficiency of total plant has 1.86% enhancement and exergy destruction reduces about 3.8 MW.