The Hindu Business Line : Gas policy likely to propose setting up of advisory body

The team
Secretary, Ministry of Petroleum and Natural Gas, would be Chairman with representatives from major gas consuming ministries, State Governments, oil and gas industry, consumer organisations, apex industry chambers and expert bodies as members.

New Delhi , Oct. 26

The soon-to-be-announced policy for natural gas pipelines and city or local natural gas distribution networks is likely to suggest setting up of a National Gas Advisory Body (NGAB), which would advise the Central Government on the issue.

"To promote and develop the gas pipeline network and the city or local gas distribution networks, constitution of NGAB has been envisaged, which would advise the Government on the subject," official sources said.

However, the advice of the Body would not be binding on the Government. It has been proposed that the Secretary, Ministry of Petroleum and Natural Gas, would be the Chairman with representatives from the major gas consuming ministries, State Governments, oil and gas industry, consumer organisations, apex industry chambers and expert bodies as members. The Petroleum Ministry may notify the constitution of the Body from time-to-time.

Policy objectives

Official sources said the objective of the policy was to promote investment from public as well as private sector in natural gas pipelines and city gas distribution networks, to facilitate open access for all players to the pipeline network on a non-discriminatory basis and promote competition among entities, thereby avoiding abuse of dominant position by any entity. To secure consumer interest in terms of gas availability and reasonable tariff for natural gas pipelines and city or local natural gas distribution networks are some of the other areas policy would seek to address, they added.

The Petroleum & Natural Gas Regulatory Board (P&NGRB) Act, 2006, provides the legal framework for the development of the natural gas pipelines and city or local gas distribution networks, but the policy will provide the crucial links for those in the business.

Marketing exclusivity

As regards the contentious issue of marketing exclusivity, it is likely to propose that the entity authorised to lay, build, operate or expand a city or local natural gas distribution network will need to follow the market service obligations as may be prescribed by the P&NGRB in accordance with the Act.

The Board may decide on the period of exclusivity in accordance with its regulations in a transparent manner while protecting consumer interest.

It is also likely to suggest that the Board may consider different exclusivity periods for setting up of city gas distribution network and for marketing gas by the entity developing such network.

To begin with, the policy may suggest a limited period exclusivity, the time frame of which would be decided by the Board.