GSPC, BG India ties up for long-term LNG supply

Gujarat State Petroleum Corporation (GSPC) on Thursday entered into a preliminary agreement with BG India, subsidiary here of the BG Group, a global integrated natural gas company, for the long-term supply of up to 2.5 million tonnes per annum (mtpa) of liquefied natural gas (LNG).
The agreement will help GSPC bridge the widening demand-supply deficit, both in Gujarat and across India. BG India proposes to sell the LNG volumes to GSPC for up to a 20-year period, beginning as early as 2014. GSPC and BG India intend to complete negotiations and execute a binding LNG sale and purchase agreement early next year. The LNG volumes will be sourced from BG Group’s current and future global supply portfolio.
GSPC and BG India have in the past successfully implemented short-term deals for spot LNG cargoes.
Frank Chapman, chief executive of the BG Group, said: “This is a landmark agreement for BG Group, establishing long-term LNG sales into one of the world’s largest and fastest growing energy markets. We have been in the Indian gas market for more than 15 years and this agreement brings essential new supplies of natural gas to the country.”
LNG has been unable to compete with cheap domestic natural gas, though there is a huge demand-supply gap in the Indian market. Walter Simpson, the company's India head, told Business Standard the company sees long-term growth in the Asian market, particularly India. He cited yesterday’s statement by BP global head, Bob Dudley, in support of market pricing for natural gas.
The demand for natural gas is likely to be driven largely by the city gas distribution and power sectors. Simpson said pricing of LNG was competitive, to suit the demand of power plants in the country. BG India, present in CGD through Gujarat Gas and Mahanagar Gas Ltd, plans to use the two companies as vehicles fo expansion into more cities, he said.
GSPC envisages a significant role in bringing the benefits of natural gas as a cleaner fuel to Gujarat and beyond, considering the huge latent demand. In a statement issued earlier this week, it said that on completion of the three pan-India pipelines to be set up by its group company, GSPL, in the next three years, it would have access to markets across the country.
Further, GSPC has options to import LNG at various terminals in Gujarat. It happens to have one of the largest gas trading businesses in the country, with a presence in gas transmission and distribution, and power generation.
In June this year, GSPC had signed an agreement with Russian petroleum giant Gazprom Global LNG, for supply of up to 2.5 mtpa of LNG.

HC rejects Essar’s gas policy claim

The steel manufacturing sector suffered another blow on Thursday, with the Delhi high court rejecting a petition filed by Essar Steel Ltd that challenged a government decision to prioritize gas supply to certain sectors.
Faced with falling production at Reliance Industries Ltd​’s D6 block in the Krishna-Godavari basin, the government asked RIL to first supply natural gas to priority sectors such as fertilizer and power, even by stopping flows to refineries and steel plants.
The petroleum and natural gas ministry has prioritized the supply of natural gas in this order: the fertilizer sector followed by liquified petroleum gas, power, city gas distribution and steel. This leaves little or no natural gas for sponge iron makers.
Essar contended that if gas supply was to be reduced or stopped according to the stated priority, the company will not survive.
In July, the Bombay high court rejected a similar petition filed by Welspun Maxsteel Ltd.
“It is the contention of the petitioner that owing to being deprived of its entitlement of natural gas, it is suffering losses of over Rs.4 crore a day. The fight is over the limited resources of natural gas from the Krishna-Godavari basin,” justice R.S. Endlaw of the Delhi high court ruled on Thursday.
Though the court acknowledged that Essar was not going to make a profit, it reasoned that the government’s intention was to ensure that critical sectors get the requisite supply of gas.
The court dismissed the petition adding that Essar should pay Rs.4 lakh to the petroleum and natural gas ministry within four weeks as cost.

Dwindling domestic gas supply, high cost of imports may take toll on CNG, piped gas prices

Prices of Compressed Natural Gas (CNG) and piped gas supplied to households are expected to rise in the coming months as supply of cheap domestic gas is dwindling and the cost of imports is rapidly rising.
The price of imported gas has risen 60% since March since an earthquake and Tsunami destroyed a nuclear plant in Japan, forcing the country to import large quantities of gas to generate power. The sharp decline in the rupee, which has fallen to its lowest level in 28 months, has exaggerated the impact of higher LNG prices.
Customers in Delhi are supplied a mix of domestic and imported gas but with local output declining, the ratio of costly LNG would rise, industry officials said. The supply of gas under the administered price mechanism (APM) is declining. Natural gas from local fields operated by ONGC and Reliance costs $4.2 per unit, while LNG prices have shot up to $16 per unit, putting pressure on city gas networks.

"With the domestic supply soon running out, we have to depend more on LNG — the imported gas which is costlier than APM. Add to it the rising operational costs and price of CNG will be effected," said Rajesh Vedvyas, managing director of Indraprastha Gas, which supplies gas in Delhi.
"Price-hike is inevitable, we have recently raised both pipedgas and CNG prices in Delhi but ... LNG prices keep increasing. We really don't have a choice but pass it on to consumers," he added.
In Gujarat, where distribution companies depend heavily on LNG, prices are already higher than Delhi, and companies say their margins are under pressure.
They are eagerly waiting for the Centre to limit the supply of subsidised liquefied petroleum gas (LPG) cylinders so that they can raise natural gas prices without losing market share to subsidised LPG.
City Gas Distribution (CGD) companies such as Mahanagar Gas that operates in Mumbai, are concerned about government subsidies cooking gas and price controls on diesel. "CGD business is competing with two major regulated areas – LPG and fuels like diesel.
Catering to households with last mile connectivity and other services is a low-return area. Gas supplies to the domestic consumers is almost a lossmaking business. However, CGD companies will be able to generate profits by charging marketdetermined tariff if subsidy on LPG is removed," Mahanagar Gas MD VC Chittoda said.
Mahanagar gas is the largest supplier of piped gas to households in the country with a customer base of over 5.15 lakh and adding close to 60,000 new connections a year. A top official of a gas company in Gujarat agreed with Chittoda.
"We are unable to charge domestic consumers market determined gas price today on account of subsidised LPG and state government intervention. However, consumers will accept higher tariff of PNG if cost of LPG goes up and it will enable us to expand our network in households."
According to a government official in Gujarat, a major LNG importer, the cost of imported gas may rise to $17-20 per unit in winter.
"On top of it, we will have to shell out Rs 49-50 per dollar instead of Rs 45-46 earlier. Higher LNG price coupled with appreciated dollar is going to hit the CGD companies and end users hard."

Forced to mix LNG, CNG makers see prices rising

Cheap natural gas, which had been slowly gaining ground in the competitive maze of powerful traditional sources of energy such as coal, petrol and diesel, may not be a cheap source anymore.
Two of the biggest city gas distribution companies in the country - Indraprastha Gas Ltd (IGL) and Mahanagar Gas Ltd (MGL) are expecting the prices of compressed natural gas (CNG) to go up at regular intervals in the coming years due to unavailability of domestic natural gas; as a result they have to resort to imported liquefied natural gas (LNG).
To meet the burgeoning demand from customers, both the companies are witnessing a gradual but marked shift towards the use of costly regassified-liquefied natural gas (R-LNG) and this is expected to be passed on to the customers, thereby denting the pockets of its customers.
“With APM gas almost reaching its full potential, our usage of R-LNG will increase from the current 10-15% and this will mean we will have to increase the price of supplied gas,” said Rajesh Vedvyas, managing director, IGL.
He was talking to newsmen at the side-lines of an energy conference organised by Proactive Universal Group, a global energy consultant.
Vedvyas said going forward there will not be any single revision in prices but the company will have to continue doing it at regular intervals to maintain its profitability and earnings.
The company currently has the mandate and supplies CNG to automotive customers and households in the National Capital Region (NCR) and plans to expand its network further to other cities.
“We have a plan to spend close to Rs3000 crore over a period of five years to expand our infrastructure. This year the company will be spending close to Rs600 crore only in building new infrastructure to supply gas,” he said.
LNG is currently available at $15 per million metric British thermal units (mmBtu) as against D6 which is available at $4.2 per mmBtu and APM gas which is over $5 per mmBtu.
Concurring with Vedvyas, VC Chittoda, chairman of MGL, said the only way forward for a gas-based economy will be to opt for R-LNG as domestic sources are not enough to suffice the demand.
“We have a plan to increase our customer base from 5.52 lakh to over 10 lakh and this will need almost doubling our gas sourcing, which can only be done through R-LNG,” he said.
The company currently consumes 2 million metric standard cubic metres per day (mmscmd) which will increase to 4.5 mmscmd by 2017, said Chittoda.
MGL currently sources part of its requirement from the administered price mechanism (APM) gas, part R-LNG and some from D6.
“Our share of R-LNG will have to increase further as we do not have higher allocation from Reliance Industries’ D6 which too is wavering,” he said and added that the company currently has an allocation of 0.36 mmscmd of gas from RIL.
While government regulations and tardy pace of approvals have held back the expansion of gas-based services in the country, experts estimate the use of natural gas to expand manifold in the coming years.
“The demand scene in the country is very robust and if there is a smooth supply, companies can actually maintain a CAGR of 20-25%. But the major problem is supply which is strangulating the progress,” said Satish Mishra, analyst with brokerage Pinc Research.
He said going by the demand projections, the demand for natural gas in India is expected to rise to 350-380 mmscmd from the current figure of 170 mmscmd, but how will this demand be met is difficult to answer, he said.

Oil India joins rush for energy assets, lines up Rs 4k crore for buys

Oil India, the country's second largest oil explorer, plans to spend up to Rs 4,000 crore in buying oil and gas assets abroad, joining bigger state-run rival ONGC in the quest to boost India's energy security.

"We have Rs 12,000 crore in cash reserves, of which we plan to invest Rs 4,000 crore on overseas acquisitions," said Chairman NM Borah.

OIL, in which the government owns a 78% stake, is looking at oil and gas blocks in Africa, Australia and Latin America. Borah said it had already conducted due diligence and was in advanced stages of negotiation with the target companies, but he refused to name them. "We (could) either own 100% of an acreage or pick up stakes of foreign companies that own blocks in these countries."

Oil India, whose exploration and production activities are spread mostly in the North East, sells its output at government-determined prices, sharing the subsidy burden with the downstream oil companies.

Its shares took a beating earlier this week after the finance ministry said the fuel subsidy outgo for the upstream oil company could almost double this fiscal year. Upstream firms bear a third of the revenue loss that oil marketing companies suffer on account of selling diesel, domestic LPG and kerosene at governmentment-controlled rates.

On Thursday, OIL shares ended 0.5% down to close at Rs 1,318 on BSE. ET had reported earlier that the ministry wanted the upstream share to be fixed at Rs 56,707 crore, or one-third of the revenue loss estimated before the June price hike and the cut in customs and excise duty. Of this, ONGC's share would be Rs 47,640 crore and the rest would be split between Oil India and GAIL India. Asked if there was on any clarity on the subsidy-sharing formula, Borah said, "No, we don't want to put undue focus on that as it is really not in our control." Oil India plans to begin production from its oil block in Venezuela from the second half of 2012. "We could start production from Carabobo 1 Norte and Carabobo 1 Centro blocks, located in the Orinoco Heavy Oil Belt... The total reserves there are of 3 billion barrels, but the initial production target is of 400,000 barrels, of which our share is 15,000 barrels," said BN Talukdar, director, exploration.

These Venezuelan oil blocks are being jointly developed by an international consortium comprising Petronas, which holds 11% stake, Spain-based Repsol 11%, ONGC Videsh 11 %, Indian Oil Corporation 3.5% and Oil India with 3.5% shareholding.

The company also said to relinquish its twin acreage in Libya. "Even after all efforts we had to concede that there is no potential for commercial hydrocarbon discovery in the area," said Talukdar. The company had invested Rs 56.8 crore there.

On E&P in India, the company said, "We would like to bid for shale gas assets and are eagerly awaiting the policy announcement from the government but plan to be very cautious with our investments in new exploration frontiers as we want to de-risk our exploration portfolio to some extent by investing in discovered targets," Talukdar said. On their presence in the Krishna-Godavri basin, Talukdar said, "We have done our initial surveys and should drill our first well in the basin by the middle of next fiscal." Discussing the firms' downstream ambitions, Borah said, "We are very keen to diversify into city-gas distribution and will be partnering with Hindustan Petroleum Corporation especially as we have already signed an MoU with them to jointly pursue business in areas of mutual interest like city gas distribution, pipeline projects and green-field refineries."

Gujarat's gas dream hits Centre roadblock

The Gujarat government's dream of turning the state into a gas capital have gone awry. State officials are blaming "indifference" on the part of the top Central regulator, Petroleum and Natural Gas Regulatory Board (PNGRB), to giving the required permissions for laying gas pipelines across the state.

"Proposals for laying gas transmission as well as distribution pipelines in towns and industrial areas in most parts of Gujarat have been held up for the last three years, as PNGRB, which is authorized to give a nod, has just refused to act", a senior official said.

Meant both for domestic and industrial use, 3,000 km long transmission pipelines were laid down in about a decade's time, benefiting about eight lakh consumers. Major urban areas like Ahmedabad, Gandhinagar, Vadodara, Surat, Rajkot, Hazira, Dahej, Valsad and Vapi were the net gainers. Of this, 1,874 km network belongs to the state-owned Gujarat State Petroleum Corporation (GSPC), while the rest, about 1,400 km, the Centre's Gas Authority of India Ltd (GAIL).

Information culled by Gujarat government officials suggest that plans had been worked out for laying down another 3,000 km of transmission pipelines in five years to benefit 10 lakh consumers. This was over and above the plans to set up 500 compressed natural gas (CNG) stations immediately needed to meet domestic vehicle demands, as the current 284 CNG stations are simply insufficient. In fact, estimates suggest, gas demand has already reached 100 million metric standard cubic metres per day (MMSCMD), while the supply is just 57 MMSCMD.

With the power sector seeing a major expansion, and auto majors like Tatas, Ford, Peugeot and Maruti coming in, the demand is likely to go up further. "While the state government has been encouraging new liquefied natural gas (LNG) terminals at Mundra, Okha and Pipavav, and the existing ones are under expansion, failure of the PNGRB to act is frustrating the entire effort", a senior official said, adding, "Representations at the highest level have failed to materialize. One doubts if things will pick up once a new PNGRB chairman takes over in October."

In fact, the bids already finalized are not being made public by the top Central regulator. Made for Bhavnagar, Jamnagar, Kutch East and Kutch West, this is adversely telling on both industry and domestic users, mainly of urban areas. The official said, "This apart, plans were worked out to lay pipelines in most of Saurashtra, North Gujarat and Central Gujarat which are today devoid of natural gas."

Financing a CGD Project

http://pptfree.com/Indiaoilgas/CGD/Financing_Cgd_Project.pdf

Have pain? don't waste it

    In adversity lies opportunity, they say. Things could not be more adverse for the government. Its popularity is zilch, inflation refuses to budge downwards, everyone in the administration is too scared even to take a deep breath, leave alone substantive decisions, the leader of the UPA ails and the world at large is conspiring to take India's markets and growth down a peg. Is there any opportunity in such adversity?

Of course. This is the time for the government to take all those tough decisions it has been postponing, dreading public anger. What about the short-term pain it would inflict on the polity and boomerang on the government? A good thing about pain is that you notice only the biggest. The severest pain the human body can experience, for example, is the one induced during childbirth. Renal colic, severe toothache and bone fracture follow. If you have renal colic, you would not notice your toothache so much. The government currently suffers enough pain to be having twins. Why waste it?

Start by slashing subsidies, most of which inflate the fiscal deficit, push up interest rates and depress growth without bringing significant benefit to anyone. Decontrol diesel and open up fuel marketing to third parties, apart from the oil marketing companies. Suppose Big Bazaar and other retailers follow the example of Wal-Mart in the US and start selling fuel. Competition from them, apart from private oil companies like Reliance and Essar, would force public sector oil marketing companies to shed the many layers of artificial cost with which they pad their prices to claim huge under-recoveries. Knock off the irrational specific excise duty on petrol and bring petrol prices in line with diesel prices. (Since this would end the skew against petrol cars, tell Maruti to settle its labour dispute fast, to boot). Raise additional revenue by levying a 1% Customs duty on crude.

Diesel prices would barely move and petrol prices would come down. Withdraw subsidised kerosene. This would put an end to adulteration of diesel. The case for subsidising kerosene has been that it is the only source of lighting for much of rural India. Solar lanterns and rural electrification are superior means to this end. But a section of the urban poor, who do not get cooking gas except in the black market, use kerosene for cooking.

So, subsidy for kerosene might need to be continued for some more time. Insist on cash transfers. Transfer the money to state governments, carry out an advertising blitzkrieg to make the entire populace aware that so much money has been transferred to the state government on account of kerosene subsidy, so that each ration card holder is entitled to so many rupees. Let public pressure make state governments work out mechanisms to transfer the subsidy to card holders double-quick. Mandate posting online of detailed, beneficiary and area-wise statements on the money disbursed, for public audit.

Withdraw subsidy for cooking gas altogether. The middle class can afford to pay what the urban poor pay in the black market. Open up marketing to allow competition to rein in price. Wherever possible, encourage city gas distribution to displace costly LPG.

Denationalise coal and decontrol coal prices. A shortterm price shock would follow, but what is a stubbed toe when you're going through labour? It would boost production, reduce dependence on imported coal, create thousands of new jobs and raise power generation. The farm sector is a sorry sight. Assorted low-yield subsidies grow wild like weeds, smothering investment.

Withdraw all input subsidies and step up investment, particularly in rural roads. Free up fertiliser pricing. Raise the minimum support price to absorb higher costs and extend purchase at MSP in every state. Farm prices and farmer spirits would soar, induce farmers to invest, boosting rural jobs, incomes and overall farm output. The short-term pain of a price adjustment is the only route to a sustained solution to food price inflation.

No price pooling for natural resources

In a landmark decision on the mechanism of pooling of prices for scarce resources in the country, an inter-ministerial committee has rejected the proposal of pooling of domestic natural gas prices with imported LNG.
Power, steel and petrochemical projects that were banking on the supply of pooled gas will become unviable.
In pooling, an average price of domestic and imported fuel is used as the selling price.
The committee said that pooling of gas prices will increase the cost of domestic gas for the fertiliser sector, which currently gets the fuel at a subsidised rate.
The recommendation will impact the proposal of pooling of coal prices in the country as well.
In an interview with DNA in April, NTPC chairman Arup Roy Choudhary said India would not be able to absorb the cost of power produced through imported LNG.
NTPC had planned an LNG-based plant to supply power to southern states.
“Now the cost of power from imported LNG has come to such a level that no one is ready to buy that,” Choudhary had said.
There is a large price differential between the domestic and imported gas currently.
Domestic gas prices, including those sold by Reliance Industries from its D6 block in the Krishna Godavari Basin off the Bay of Bengal, are at $4.2 to $5.5 per million metric British Thermal unit, or mmBtu (excluding transportation charges and taxes).
That’s much lower than imported LNG, which is available at $10-$14 per mmBtu.
“The committee does not recommend pooling mechanism for natural gas at the overall level, nor does it recommend a price pooling on a sectoral basis, except where that may be found to be the best workable option,” said the report.
The committee has opted for preferential allotment on a scheme of priority as a basis for allocating natural gas.
The fertiliser and the power sectors have been given the first priority. However, the committee estimates that the fertiliser sector will have to meet 21-22% of its total requirement through imported LNG, while the power sector will have to arrange up to 25.27% of its requirement through imports.
The report said all the users including the city gas distribution (CGD) and the non-priority sectors (petrochemicals, sponge and steel) would have to source bulk of their requirement from imported LNG.
In this fiscal, about 73% of their requirement would have to be met through imports. The proportion of imported gas is likely to go up to 80% for these sectors by 2016-17.
The non-priority sectors currently consume about 18.4 mmscmd of domestic gas and only 5 mmscmd is being set aside for these users.

Oil India: Likely to Invest in HPCL's Refinery Projects

Oil India Ltd. is likely to invest in Hindustan Petroleum Corp.'s refinery expansion and new projects, Oil India Chairman N.M. Borah said Thursday.

Enlarge Image

Agence France-Presse/Getty Images

An employee of a petrol station run by Hindustan Petroleum Corp. in New Delhi.

"Our core competence lies in the upstream sector but we would like to have some diversification in the exploration and production value chain," Mr. Borah told reporters on the sidelines of an event. "We think HPCL could be a valuable partner."
State-run explorer Oil India and refiner HPCL in August signed an initial pact to pursue business opportunities in exploration and production, city gas distribution, pipeline projects, new refineries, and research and development.
Oil India in 2009 signed an initial pact with state-run Bharat Petroleum Corp. to form a joint venture for city gas projects. It has another joint venture with Indian Oil Corp. to scout for oil and gas assets abroad.
Explorers look to diversify into other fields like refining and city gas projects through joint ventures to partly hedge against exploration ventures, which involve high risk and high investments.
Mr. Borah said Oil India plans to immediately spend 40 billion rupees ($843.8 million) to 50 billion rupees on its diversification efforts.
Oil India is also conducting due diligence in various parts of the world for oil and gas assets, he said, adding that some of the negotiations are in advanced stages.
The explorer, which currently holds about 120 billion rupees cash reserves, has identified oil and gas assets in Africa, Australia and Latin America, he said.

Liquefied Natural Gas terminal in east coast India: Green Eenrgy

Kolkata, Sept. 12 (Calcutta Tube / IBNS) India would set up its third largest Liquefied Natural Gas (LNG) terminal somewhere in the east coast to fulfill the requirement of gas and put thrust on green energy.
“Considering various factor like transportation availability, risk, cost effectiveness, futuristic fuel infrastructure and shortage of 180 mncc of LNG by 2014-15, we need pipeline and terminals for supply and storage,” said A.K. Baliyan, MD & CEO, Petronet LNG Ltd.The proposed terminal will be able to store upto 5 million tonne of gas, Baliyan said.
He was speaking at a conference on waste management in Kolkata organised by FICCI and Petroleum and Natural Gas Regulatory Body (PNGRB) recently.
“We are very much behind the target of pipeline infrastructure required,” said Baliyan.
Three gas projects being set up in the in the eastern region are in limbo due to unavailability of gas supply.
Kakinada-Haldia pipeline which was authorised to Reliance Industries Ltd. (RIL) by the centre is supposed to supply natural gas from Krishna-Godavari (KG) to parts of Orissa, Andhra Pradesh and southern districts of West Bengal.
The second project facing a roadblock is the 800-km Jagdishpur-Haldia pipeline by Indian Oil Corporation Ltd (IOC) and Gas Authority of India Ltd (GAIL).

It is an ambitious project that once completed will transport compressed natural gas (CNG)  extracted in Gujarat to West Bengal.
It is going to be a Rs 7,600-crore pipeline running  from Jagdishpur in UP to Haldia in West Bengal sometime in 2013, to cater to requirements at Allahabad, Varanasi, Gorakhpur, Patna, Gaya, Bokaro, Ranchi, Jamshedpur, Sindri, Durgapur, Katwa, Bandel and Kolkata along the way.
The third project facing uncertainty is Asansol-Kolkata pipeline project. It has been deferred for six months due to unavailability of  LNG and under bidding . After Kolkata, this pipeline  will extend upto Haldia.
Jagdishpur-Siliguri-Haldia pipeline covers Bihar, Jharkhand, West Bengal and many other eastern states.
Many Gas Allocations (GAs) points are planned for the supply of LNG in states like Bihar, West Bengal ,Orissa and Sikkim.
In this region 15,000 km. long pipeline would be laid down by 2014 which will cost about Rs.10,000-15,000 crore,said B.S.Negi, Member of  PNGRB.
J.R.Bhardwaj, member of Chemical (Industrial) Disaster Management (CIDM), said, “PNGRB will help LNG suppliers to create an export forum, integrated management system, emergency service system and security system.”

GAIL - CGD Bsuiness

GAIL is the pioneer of city gas distribution in India. GAIL took many initiatives to introduce PNG for households and CNG for the transport sector to address the rising pollution levels. Pilot projects were launched in early 1990s in two metros Delhi and Mumbai through joint venture companies Indraprastha Gas Limited (IGL) and Mahanagar Gas Limited (MGL) leading to the start of commercial operation of city gas projects. The results of these ventures are quite visible through the improvement in air quality in these cities.

Based on the success of IGL and MGL, GAIL has further set up six more JVCs viz Bhagyanagar Gas Limited, Andhra Pradesh; Avantika Gas Limited in Madhya Pradesh; Central U P Gas Limited & Green Gas Limited in Uttar Pradesh; Maharashtra Natural Gas Limited in Pune Maharashtra and Tripura Natural Gas Company Limited in Tripura for CGD projects in various cities.

However, Ministry of Petroleum & Natural Gas established the Petroleum and Natural Gas Regulatory Board (PNGRB) with effect from 01.10.2007, under the Petroleum and Natural Gas Regulatory Board Act 2006, to regulate the refining, processing, storage, transportation, distribution, marketing and sale of petroleum, petroleum products and natural gas excluding production of crude oil and natural gas. The Petroleum & Natural Gas Regulatory Board Act-2006 provides the legal framework for the development of the natural gas pipelines and city or local gas distribution networks. With the arrival of the PNGRB the implementation of PNG in various cities is being taken up in a phased manner as and when the bids are called for by the Regulator.

In the future as and when the bids are called for the CGD network development by the PNGRB, interested entities may submit the bids and whoever is successful in the bidding will be authorized to develop the CGD network consisting of CNG & PNG infrastructure in that particular city. This has induced other entities to come into CGD projects and thus a competitive era in this field has been initiated.

In this competitive environment, a sincere and dedicated approach, energy and focus have been taken to maintain GAIL's leading position in CGD projects. This has necessitated the requirement of a new establishment of GAIL dedicated to CGD projects. Accordingly, for implementation of the city gas distribution projects smoothly, a wholly owned subsidiary of GAIL (India) Limited, GAIL Gas Limited, was incorporated on May 27, 2008 as a limited company under the Companies Act.

GAIL Gas Limited has been authorized by PNGRB and MoPNG for implementing City Gas Distribution Projects in Dewas (Madhya Pradesh), Kota (Rajasthan), Sonepat (Haryana), Meerut (Uttar Pradesh), Firozabad (Uttar Pradesh) and Vadodara (Gujarat).

As per the business plan, GAIL Gas would be expanding the CGD business in dedicated and aggressive manner and will facilitate re-investing returns from operational CGD projects into new projects thus reducing the need for fresh equity infusions by GAIL.

As per the estimate more than 200 cities have been identified for the development of CGD projects in a phased manner in synchronization with the commissioning of the pipeline. The details of these cities have already been forwarded to MoPNG by GAIL with a request for authorization for setting up of CGD network in these cities.

Gas supplied by GAIL to retail gas distributors serves more than 6,00,000 automobiles as Compressed Natural Gas (CNG) and over 6,50,000 households as Piped Natural Gas (PNG). Various cities are covered in the network.

PNG Network

State City Company Delhi Delhi IGL UP Noida   Greater Noida   Ghaziabad Maharastra Mumbai MGL Thane Mira-Bhayandar Navi Mumbai Pune Uttar Pradesh Kanpur CUGL Bareilly Lucknow GGL Agra Gujarat Vadodara GAIL Andhra Pradesh Vijaywada BGL Hyderabad Rajahmundery Tripura Agartala TNGCL Madhya Pradesh Dewas GAIL Gas Indore AGL Haryana Sonepat GAIL Gas

CNG Network

State City Company Delhi Delhi IGL UP Noida   Greater Noida   Ghaziabad Maharastra Mumbai MGL Thane Mira-Bhayandar Navi Mumbai Pune MNGL Uttar Pradesh Kanpur CUGL   Bareilly Tripura Agartala TNGCL Madhya Pradesh Dewas GAIL Gas Indore AGL   Ujaain Haryana Sonepat GAIL Gas Maharastra Panvel Gujarat Vadodara

GAIL's City Gas Distribution initiatives are not confined to India. It has established its presence in the CNG and City Gas arenas in Egypt through equity participation in Fayum Gas, Shell CNG and Natgas; and has acquired a stake in China Gas Holding to pursue CNG opportunities in mainland China. GAIL plans to develop City Gas markets worldwide in collaboration with global oil and gas majors.

Current Issues on Reliance KGD6 (Krishna Godavari Basin) Production?

The gas from KGD6 offshore as per planned was received at own land at Gadimoga village, in Andhra Pradesh, situated in the eastern part of Godavari district and relayed through the Pipeline of East West RGTIL or Reliance Gas Transportation Infrastructure.

The peak production capacity of oil and gas at KG-D6 was expected above 5, 50,000 oil barrels equivalent per day.
RIL started gas production from the spot of discovery much shorter and earlier period (6 and half year) than the world average around 10 years in respect of similar deep water gas production facility that too in a regular rough weather condition of Bay of Bengal.

Reliance Krishna Godavri Basin Production

As per report on August 4, 2011, Reliance Industries’ esteemed KG-D6 project have recorded a drop of output by 27 % at about 47 million cubic meters (standard) every day in June.
Productions of KG-D6 field reached 60 mmscmd in 2010. However, the decline in production started from December 2010 and in the month of June 2011 the average production from KG-D6 field has came down to 47 mmscmd.
RIL has shutdown to undertake some maintenance of preservative work at a Floating Production Storages cum Offloading compressor on the or FPSO unit working in the MA oilfield that produces about 7.6 million cubic meters (standard) /day of natural gas from its 5 wells and a little less than 15 Thousand barrels/day of oil.
The huge D1 and D3 gas fields, is currently producing about 46 mmscmd of gas per day.
The maintenance will continue for 15 days and gas production from MA field will remain closed for only 3 to 4 days.

Current Issues on Reliance KGD6

As per statements issued by Reliance Industries their project cost is much lower than that of oil PSUs like ONGC and GSPC on their projects near the KG basin.
Reliance earlier denied the CAGs allegations that RIL has inflated project costs which reduced government’s share of revenue from the KG-D6 project. They argued that its project costs are even much lower than the costs involved in the shallow water projects.
The present production is just sufficient to meet up the agreed demand of the core sectors — 29 mmscmd for power plants, 15.35 mmscmd for fertilizer units, 2.59 mmscmd for LPG plants and 0.65 mmscmd of city gas distribution firms.
Oil ministry had directed in May 2011 that the products of KG-D6 must meet up the contracted demand of core users first, thereafter if any surplus remains it may cater the non-core sectors, for example, steel, petrochemicals and refineries. A priority order has been fixed for the core sector in descending order as — fertilizer plants, LPG plants, power and last of all to city gas users.

Andhra Pradesh government seeks to build LNG terminal

 The Andhra Pradesh government has requested the Centre to build a Liquefied Natural Gas terminal on the east coast of the state to meet natural gas requirements of critical industrial sectors.
Chief Minister N Kiran Kumar Reddy wrote a letter to Union Petroleum Minister S Jaipal Reddy on Thursday and said the terminal would help in industrial development in the region.
Sectors like power, fertilisers, steel, refineries as well as the city gas distribution network required LNG and Reliquefied Natural Gas, but were currently facing a short supply, he said.

While 12.97mmscmd of natural gas was required for the nine gasbased power projects in operation in the state, only 9.75 mmscmd was available from Reliance's D-6 field and ONGC.
The only mechanism at present to supply LNG to willing customers in Andhra Pradesh is swapping of KG D-6 gas and RLNG being procured on the west-coast.

Govt. Authorized NG Pipelines

Authorized under regulation 5

S. No.	Name of NG Pipeline	Route/Region	Entity Authorized
1	Letters to M/s GSPL regarding Grant of Authorization for Natural Gas Pipelines."Dated:06-07-2011	Mallavaram-Bhopal-Bhilwara-Vijaipur	M/s Gujarat State Petronet Limited
2	Letters to M/s GSPL regarding Grant of Authorization for Natural Gas Pipelines."Dated:06-07-2011	Mehsana-Bhatinda	M/s Gujarat State Petronet Limited
3	Letters to M/s GSPL regarding Grant of Authorization for Natural Gas Pipelines."Dated:06-07-2011	Bhatinda-Jammu-Srinagar	M/s Gujarat State Petronet Limited

Acceptance of central govt. authorization : under regulation 17

S. No.	Name of NG Pipeline	Route/Region	Entity Authorized
1	Dadri-Bawana-Nangal	Dadri-Bawana-Nangal	Gail(India) Limited
2	Dadri-Panipat	Dadri-Panipat	Indian Oil Corporation Limited
3	Uran-Trombay	Uran-Trombay	Oil and Natural Gas Corporation Limited
4	DVPL-GREP	DVPL-GREP Capacity augmentation	Gail(India) Limited
5	Mumbai Regional	Mumbai Regional	Gail(India) Limited
6	Chhainsa-Jhajjar-Hissar	Chhainsa-Jhajjar-Hissar	Gail(India) Limited
7	Agartala Regional	Agartala Regional	Gail(India) Limited
8	Dahej-Uran-Panvel-Dhabol	Dahej-Uran-Panvel-Dhabol	Gail(India) Limited
9	K.G.Basin	K.G.Basin	Gail(India) Limited
10	HVJ-GREP-DVPL	Hazira-Vijaipur-Jagdishpur-GREP-Dahej-Vijaipur	Gail(India) Limited
11	EWPL	Kakinada-Hyderabad-Uran-Ahmedabad	Reliance Gas Transportation Infrastructure Limited

Authorized under regulation 18

S. No.	Name of NG Pipeline	Route/Region	Entity Authorized
1

Authorized under regulation 19

S. No.	Name of NG Pipeline	Route/Region	Entity Authorized
1

Govt. Authorized CGD Network

Authorized under regulation 5

S. No.	Name of the CGD Network	Area Covered	Entity Authorized
1	Sonipat CGD Network	Sonipat	Gail Gas Limited
2	Meerut CGD Network	Meerut	Gail Gas Limited
3	Kakinada CGD Network	Kakinada	Bhagyanagar Gas Limited
4	Dewas CGD Network	Dewas	Gail Gas Limited
5	Kota CGD Network	Kota	Gail Gas Limited
6	Mathura CGD Network	Mathura	JV of M/s DSM Infratech Pvt. Ltd. & M/s Saumya Mining Pvt. Ltd.

Acceptance of central govt. authorization : under regulation 17

S. No.	Name of the CGD Network	Area Covered	Entity Authorized
7	Agra CGD Network	Agra	Green Gas Limited
8	Hyderabad CGD Network	Hyderabad	Bhagyanagar Gas Limited
9	Indore CGD Network	Indore including Ujjain	Aavantika Gas Limited
10	Ghandhinagar Mehsana Sabarkantha CGD Network	Ghandhinagar Mehsana Sabarkantha	Sabarmati Gas Limited
11	Pune City including Pimpri Chichwad CGD Network	Pune City including Pimpri Chiechwad and along with adjoining contiguous areas of Hinjewadi, Chakan & Talegaon GA	Maharashtra Natural Gas Limited
12	Kanpur CGD Network	Kanpur GA	Central U.P. Gas Limited
13	Bareilly CGD Network	Bareilly GA	Central U.P. Gas Limited
14	Delhi CGD Network	National Capital Territory of Delhi	Indraprastha Gas Limited
15	Mumbai CGD Network	Mumbai & Greater Mumbai	Mahanagar Gas Limited
16	Vijaywada CGD Network	Vijaywada GA	Bhagyanagar Gas Limited
17	Mumbai CGD Network(GA-2)	Thane City & adjoining contiguous areas including Mira Bhayender, Navi Mumbai, Thane City,Ambernath, Bhiwandi,Kalyan, Dombivily, Badlapur, Ulhasnagar, Panvel,Kharghar & Taloja.	Mahanagar Gas Limited

Authorized under regulation 18

S. No.	Name of the CGD Network	Area Covered	Entity Authorized
18

PNGRB - Petroleum & Gas Regulatory Board

The Petroleum and Natural Gas Regulatory Board (PNGRB) was constituted under The Petroleum and Natural Gas Regulatory Board Act, 2006 (NO. 19 OF 2006) notified via Gazette Notification dated 31st March, 2006.

The Act provide for the establishment of Petroleum and Natural Gas Regulatory Board to protect the interests of consumers and entities engaged in specified activities relating to petroleum, petroleum products and natural gas and to promote competitive markets and for matters connected therewith or incidental thereto.

Further as enshrined in the act, the board has also been mandated to regulate the refining, processing, storage, transportation, distribution, marketing and sale of petroleum, petroleum products and natural gas excluding production of crude oil and natural gas so as and to ensure uninterrupted and adequate supply of petroleum, petroleum products and natural gas in all parts of the country.

Currently, following incumbents, professionally grace, the seats of decision making in the Board:

• Sh. L. Mansingh, Chairperson
• Sh. B.S. Negi, Member (Infrastructure)
• Mrs. Sudha Mahalingum, Member (Distribution)
• Dr. Y.P.C. Dangay, Member (Legal)
• Sh. Ratan P. Watal, Secretary

Vision
“To create a vibrant energy market with rapid and orderly growth through facilitation of flow of investments into the basic infrastructure for efficient transportation and distribution of petroleum, petroleum products and natural  gas at minimum cost and  high level of protection of consumer interests through fair trade practices and competition amongst the entities so as to ensure the enhanced competitiveness of Indian economy and customer satisfaction.”

Functions of the Board

The Board shall- (A) protect the interest of consumers by fostering fair trade and competition amongst the entities; (B) register entities to- market notified petroleum and petroleum products and, subject to the contractual obligations of the Central Government, natural gas; establish and operate liquefied natural gas terminals; establish storage facilities for petroleum, petroleum products or natural gas exceeding such capacity as may be specified by regulations; (C) authorise entities to- lay, build, operate or expand a common carrier or contract carrier; lay, build, operate or expand city or local natural gas distribution network; (D) declare pipelines as common carrier or contract carrier; (E) regulate, by regulations,- access to common carrier or contract carrier so as to ensure fair trade and competition amongst entities and for that purpose specify pipeline access code; transportation rates for common carrier or contract carrier; access to city or local natural gas distribution network so as to ensure fair trade and competition amongst entities as per pipeline access code; (F) in respect of notified petroleum, petroleum products and natural gas- ensure adequate availability; ensure display of information about the maximum retail prices fixed by the entity for consumers at retail outlets; monitor prices and take corrective measures to prevent restrictive trade practice by the entities; secure equitable distribution for petroleum and petroleum products; provide, by regulations, and enforce, retail service obligations for retail outlets and marketing service obligations for entities; monitor transportation rates and take corrective action to prevent restrictive trade practice by the entities; (G) levy fees and other charges as determined by regulations; (H) maintain a data bank of information on activities relating to petroleum, petroleum products and natural gas; (I) lay down, by regulations, the technical standards and specifications including safety standards in activities relating to petroleum, petroleum products and natural gas, including the construction and operation of pipeline and infrastructure projects related to downstream petroleum and natural gas sector; (J) perform such other functions as may be entrusted to it by the Central Government to carry out the provisions of this Act.

Powers of Board

1. The Board shall have jurisdiction to-

1. adjudicate upon and decide any dispute or matter arising amongst entities or between an entity and any other person on issues relating to refining, processing, storage, transportation, distribution, marketing and sale of petroleum, petroleum products and natural gas according to the provisions of Chapter V, unless the parties have agreed for arbitration;
2. receive any complaint from any person and conduct any inquiry and investigation connected with the activities relating to petroleum, petroleum products and natural gas on contravention of-

1. retail service obligations;
2. marketing service obligations;
3. display of retail price at retail outlets;
4. terms and conditions subject to which a pipeline has been declared as common carrier or contract carrier or access for other entities was allowed to a city or local natural gas distribution network, or authorisation has been granted to an entity for laying, building, expanding or operating a pipeline as common carrier or contract carrier or authorisation has been granted to an entity for laying, building, expanding or operating a city or local natural gas distribution network;
5. any other provision of this Act or the rules or the regulations or orders made there under.

(B) While deciding a complaint under sub-section (1), the Board may pass such orders and issue such directions as it deems fit or refer the matter for investigation according to the provisions of Chapter V.

Chairperson
Shri L. Mansingh belonged to the 1970 batch of the Indian Administrative Service of the Gujarat cadre. His last assignment prior to superannuation was Secretary to Government of India in the Ministry of Consumer Affairs, Food & Public Distribution, Department of Consumer Affairs from 01.06.2004 to 31.10. 2006. In this assignment, he was responsible for all consumer-related issues, internal trade including futures trading, commodities exchanges, monitoring of prices of essential commodities and ensuring adequate availability of these commodities. Standards setting and conformity assessment through Bureau of Indian Standards was also part of the responsibilities.

Prior to the present assignment, Shri Mansingh was Director General of Foreign Trade for the period from August, 2002 to May, 2004. During his tenure, the reform process in this area was carried forward through total simplification of the EXIM Policy and the procedures to make it exporter friendly with adoption of infotech. DGFT Head Office became ISO 9200 certified with all Zonal and Regional Offices initiating the process of getting certified.

In his first stint with Government of India, Shri Mansingh was Under Secretary and Deputy Secretary in the Ministry of Commerce looking after engineering and project exports. In his second stint from 1987-1992, he was Joint Secretary (Industrial Policy) in the Department of Industrial Development in charge of Secretariat for Industrial Approvals (SIA). As such, he was directly responsible for the implementation of the New Industrial Policy, 1991 which started the process of liberalization.

In Government of Gujarat, Shri Mansingh has worked in various capacities, most of which have been in areas of finance, investment promotion and industrial development and management of large projects. He has occupied posts such as Director (Institutional Finance); Secretary (Economic Affairs); Managing Director, Sardar Sarovar Narmada Nigam; Industries Commissioner; Managing Director, Gujarat Industrial Investment Corporation and Principal Secretary of Industries & Mines Department. He was also the Member-Secretary of the State Finance Commission with a broad TOR encompassing the role of the State Government in a liberalized economic environment, which submitted its report in April, 1994. As such, Shri Mansingh has direct involvement and experience in formulation and implementation of reform process in both the State and the Central levels.

He has been appointed as the Chairperson of Petroleum and Natural Gas Regulatory Board on 25th June, 2007, with a tenure of 5 years. 

Board Members

Member Infrastructure

Shri B.S.Negi , is a Post Graduate in Mechanical Engineering with Honours and Post Graduate in Project Management. He is a chartered engineer and the Fellow of Indian Institute of Mechanical Engineering. He has 38 years of experience spreading in the areas of Oil Refining, Fertilizers, Gas Processing, Transportation, E&P and Gas Sourcing.

He has been associated with import of LNG to India from Qatar, Iran, Yemen & Australia etc. Shri Negi has been the Member of the technical team from India negotiating for Iran-Pakistan-India (IPI), Turkmenistan-Afghanistan-Pakistan-India (TAPI) and Myanmar India gas Pipelines. Shri Negi has authored a book published in January, 2008 titled “ LNG- An Indian Scanerio”

Shri Negi has served in various capacities in the organizations like Indian Oil Corporation Ltd, National Fertilizers Limited and GAIL (India) Limited. He has been in the boards of several companies in India as well as abroad.

After superannuating from GAIL (India) Limited as its Director (Business Development) Shri Negi has been appointed by the Government of India as Member of the first Oil & Gas Sector Regulatory Board the Petroleum & Natural Gas Regulatory Board (PNGRB).

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Member Distribution

Mrs. Sudha Mahalingam, is an energy economist with over 25 years of professional experience. She has worked for several leading think-tanks and research institutes in India and has held positions of responsibility in business journalism and academia. Prior to joining the Petroleum and Natural Gas Regulatory Board, Mrs.Mahalingam held the prestigious Senior Fellowship at the Jawaharlal Nehru Centre for Contemporary Studies, Nehru Memorial Museum & Library, New Delhi, where she was researching on India's energy security At Centre for Policy Research, a renowned think-tank based in Delhi, Mrs. Mahalingam headed the country project on Electricity Governance. At the Institute for Defence Studies and Analyses, New Delhi, she headed the Cluster on Energy, Environment and Economics. Mrs. Mahalingam has undertaken energy-related consultancy assignments for multilateral organisations including the World Bank.

She has been championing the consumer cause in the electricity sector through purposeful interventions in the electricity regulatory space. Her areas of interest include the geopolitical, regulatory, economic and environmental dimensions of all forms of energy -oil, gas, coal as well as electricity from nuclear, hydropower and other renewables. She has published widely in Indian and international journals and has been writing regularly in the popular press. Mrs. Mahalingam is also a frequent speaker in national and international energy conferences.

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Member Legal

Dr YPC Dangay , LLB, PGD in Constitutional Law, LLM, LLD, started his career as a Law Teacher in 1973 teaching all subjects to students of LLB as well as LLM and guiding research. He was appointed as examiner in several Universities and acted as Convener of Research Degree Committee. Subsequently in October 1988, he joined the Government of India as Assistant Legal Advisor in the Department of Legal Affairs as a direct recruit through UPSC and later on as Deputy Legal Adviser. He was later on promoted as Additional Legal Advisor in the same Department (Grade II of Indian Legal Service), wherein he also held independent charge as head of office, Branch Secretariat of Ministry of Law and Justice at Bangalore. He has also held the position of Legal Adviser in the Ministry of Defence, as an Arbitrator (in the rank of Joint Secretary) in the Ministry of Urban Affairs & Employment and Legal Adviser, DGFT in the Ministry of Commerce. As Joint Secretary & Legal Advisor (Grade I of Indian Legal Service), in the Department of Legal Affairs, he has tendered legal advice and opinions on various matters to virtually all Departments/Ministries in the Government of India. He was also associated with various high powered Committees of the Government of India on diverse issues.

Dr Dangay was also a Member of the Government of India delegation in June 2006 that negotiated and finalized an Agreement on Social Security between the Kingdom of Belgium and India in Brussels. He has also been awarded the prestigious Teacher Fellowship (1976-79) under Faculty Improvement Programme of University Grants Commission and is a Life Member, Indian Law Institute, New Delhi, as well as Life Member of the Central India Law Institute, Jabalpur (M.P.)

Dr Dangay joined the Petroleum Natural Gas Regulatory Board on 31.7.2007 as Member (Legal) with tenure of 5 years, after taking VRS from the Government of India.

PNGRB Act

An Act to provide for the establishment of Petroleum and Natural Gas Regulatory Board to regulate the refining, processing, storage, transportation, distribution, marketing and sale of petroleum, petroleum products and natural gas excluding production of crude oil and natural gas so as to protect the interests of consumers and entities engaged in specified activities relating to petroleum, petroleum products and natural gas and to ensure uninterrupted and adequate supply of petroleum, petroleum products and natural gas in all parts of the country and to promote competitive markets and for matters connected therewith or incidental thereto. BE it enacted by Parliament in the Fifty-seventh Year of the Republic of India as follows:-

CHAPTER I

PRELIMINARY

1. Short title, extent, commencement and application :- 

(1) This Act may be called the Petroleum and Natural Gas Regulatory Board Act, 2006.

(2) It extends to the whole of India.

(3) It shall come into force on such date as the Central Government may, by notification in the Official Gazette, appoint: Provided that different dates may be appointed for different provisions of this Act and any reference in any such provision to the commencement of this Act shall be construed as a reference to the coming into force of that provision.

(4) It applies to refining, processing, storage, transportation, distribution, marketing and sale of petroleum, petroleum products and natural gas excluding production of crude oil and natural gas.

2. Definitions :-

In this Act, unless the context otherwise requires :-

(a) "affiliate code of conduct" means the code of conduct governing entities engaged in storage, transmission, distribution, marketing and sale of natural gas under sub-section (1) of section 21;

(b) "Appellate Tribunal" means the Appellate Tribunal referred to in section 30;

(c) "appointed day" means the date on which the Board is established under sub-  section (1) of section 3;

(d) "authorised entity" means an entity-

     (A) registered by the Board under section 15 -

           (i) to market any notified petroleum, petroleum products or natural gas, or

           (ii) to establish and operate liquefied natural gas terminals, or

     (B) authorised by the Board under section 16 -

         

          (i)   to lay, build, operate or expand a common carrier or contract carrier, or

 (ii) to lay, build, operate or expand a city or local natural gas distribution network;

(e) "auto liquefied petroleum gas" means a mixture of certain light hydrocarbons derived from petroleum, which are gaseous at normal ambient temperature and atmospheric pressure but may be condensed to the liquid state at normal ambient temperature by the application of moderate pressure, and which conform to such specifications for use as fuel in vehicles, as the Central Government may, in consultation with the Bureau of Indian Standards, notify from time to time;

(f) ''Board" means the Petroleum and Natural Gas Regulatory Board established under sub-section (1) of section 3;

(g) "Bureau of Indian Standards" means the Bureau of Indian Standards established under section 3 of the Bureau of Indian Standards Act, 1986 (63 of 1986);

(h) "Chairperson" means the Chairperson of the Board appointed under sub-section (1) of section 4;

 (i) "city or local natural gas distribution network" means an interconnected network of gas pipelines and the associated equipment used for transporting natural gas from a bulk supply high pressure transmission main to the medium pressure distribution grid and subsequently to the service pipes supplying natural gas to domestic, industrial or commercial premises and CNG stations situated in a specified geographical area.

Explanation :- For the purposes of this clause, the expressions "high pressure" and "medium pressure" shall mean such pressure as the Central Government may, by notification, specify to be high pressure or, as the case may be, medium pressure;

(j) "common carrier" means such pipelines for transportation of petroleum, petroleum products and natural gas by more than one entity as the Board may declare or authorise from time to time on a nondiscriminatory open access basis under sub-section (3) of section 20, but does not include pipelines laid to supply-

   (i) petroleum products or natural gas to a specific consumer; or

   (ii) crude oil;

        Explanation.- For the purposes of this clause, a contract carrier shall be treated as a common carrier, if –

            (a) such contract carrier has surplus capacity over and above the firm contracts entered into; or

       (b) the firm contract period has expired.

(k) "CNG station" means filling station where one or more dispensing units are provided for sale of compressed natural gas;

(l) "compressed natural gas or CNG" means natural gas used as fuel for vehicles, typically compressed to the pressure ranging from 200 to 250 bars in the gaseous state;

(m) "contract carrier" means such pipelines for transportation of petroleum, petroleum products and natural gas by more than one entity pursuant to firm contracts for at least one year as may be declared or authorised by the Board from time to time under sub-section (3) of section 20;

(n) "dealer" means a person, association of persons, firm, company or co-operative society, by whatsoever name called or referred to, and appointed by an oil company to purchase, receive, store and sell motor spirit, high speed diesel, superior kerosene oil, auto liquefied petroleum gas or natural gas;

(o) "distributor" means a person, association of persons, firm, company or co-operative society, by whatsoever name called or referred to, and appointed by an oil company to purchase, receive, store and sell to consumers liquefied petroleum gas in cylinders;

(p) "entity" means a person, association of persons, firm, company or co-operative society, by whatsoever name called or referred to, other than a dealer or distributor, and engaged or intending to be engaged in refining, processing, storage, transportation, distribution, marketing, import and export of petroleum, petroleum products and natural gas including laying of pipelines for transportation of petroleum, petroleum products and natural gas, or laying, building, operating or expanding city or local natural gas distribution network or establishing and operating a liquefied natural gas terminal;

(q) "exchange of products" shall mean giving and receiving of a petroleum product in accordance with an agreement entered into by the concerned entities;

(r) "high speed diesel" means any hydrocarbon oil (excluding mineral colza oil and turpentine substitute), which conforms to such specifications for use as fuel in compression ignition engines, as the Central Government may, in consultation with the Bureau of Indian Standards, notify from time to time;

(s) "kerosene or superior kerosene oil" means a middle distillate mixture of hydrocarbons which conforms to such specifications, as the Central Government may, in consultation with the Bureau of Indian Standards, notify from time to time;

(t) "liquefied natural gas terminal" means the facilities and infrastructure required to-

   (i) receive liquefied natural gas;

   (ii) store liquefied natural gas;

  (iii) enable degasification of liquefied natural gas; and

  (iv) transport degasified liquefied natural gas till the outside boundaries of the     facility;

(u) "liquefied petroleum gas" means a mixture of light hydrocarbons containing propane, isobutene, normal butane, butylenes, or such other substance which is gaseous at normal ambient temperature and atmospheric pressure but may be condensed to liquid state at normal ambient temperature by the application of pressure and conforms to such specifications, as the Central Government may, in consultation with the Bureau of Indian Standards, notify from time to time;

(v) "local distribution entity" means an entity authorised by the Board under section 20 to lay, build, operate or expand a city or local natural gas distribution network;

(w) "marketing service obligations" means obligations-

    (i) to set up marketing infrastructure and retail outlets in remote areas in respect of   notified petroleum and petroleum products;

    (ii) to maintain minimum stock of notified petroleum and petroleum products;

   (iii) of a local distribution entity to supply natural gas to consumers; and

   (iv) such other obligations as may be specified by regulations;

(x) "maximum retail price" means the maximum price fixed by an entity at which the petroleum, petroleum products and natural gas may be sold to the retail consumers and includes all taxes, cess and levies, local or otherwise and freight or commission payable to the dealers;

(y) "member" means a member of the Board appointed under sub-section (1) of section 4 and includes the Member (Legal) and the Chairperson;

(z) "motor spirit" means any hydrocarbon oil (excluding crude mineral oil) used as fuel in spark ignition engines which conforms to such specifications, as the Central Government may, in consultation with the Bureau of Indian Standards, notify from time to time;

(za)"natural gas" means gas obtained from bore-holes and consisting primarily of hydrocarbons and includes-

(i) gas in liquid state, namely, liquefied natural gas and degasified liquefied natural gas,

(ii) compressed natural gas,

(iii) gas imported through transnational pipe lines, including CNG or liquefied natural gas,

(iv) gas recovered from gas hydrates as natural gas,

(v) methane obtained from coal seams, namely, coal bed methane, but does not include helium occurring in association with such hydrocarbons;

(zb)"notification" means a notification published in the Official Gazette and the expression "notified" with its cognate meanings and grammatical variations, shall be construed accordingly;

(zc)"notified petroleum, petroleum products and natural gas" means such petroleum, petroleum products and natural gas as the Central Government may notify from time to time, after being satisfied that it is necessary or expedient so to do for maintaining or increasing their supplies or for securing their equitable distribution or ensuring adequate availability;

(zd)"oil company" means a company registered under the Companies Act, 1956 and includes an association of persons, society or firm, by whatsoever name called or referred to, for carrying out an activity relating to petroleum, petroleum products and natural gas;

(ze)"petroleum" means any liquid hydrocarbon or mixture of hydrocarbons, and any inflammable mixture (liquid, viscous or solid) containing any liquid hydrocarbon, including crude oil and liquefied petroleum gas, and the expression 'petroleum product' shall mean any product manufactured from petroleum;

(zf)"pipeline access code" means the code to establish a framework for third party access to pipelines under sub-clause (i) of clause (ze) of section 11;

(zg) "prescribed" means prescribed by rules made by the Central Government  under this Act;

(zh) "regulations" means regulations made by the Board under this Act;

(zi) "restrictive trade practice" means a trade practice which has, or may have, the effect of preventing, distorting or restricting competition in any manner and in particular,-

   (i)  which tends to obstruct the flow of capital or resources into the stream of  production, or

  (ii)  which tends to bring about manipulation of prices, or conditions of delivery or to  affect the flow of supplies in the market relating to petroleum, petroleum products or natural gas or services in such manner as to impose on the consumers unjustified costs or restrictions;

(zj) "retail outlet" means filling station where one or more dispensing pumps have been provided for sale of motor spirit, high speed diesel, auto-liquefied petroleum gas or natural gas and includes distributorship for liquefied petroleum gas or dealership for superior kerosene oil or CNG stations;

(zk) "retail service obligations" means obligations of dealers and distributors for maintaining supplies to consumers throughout the specified working hours and of specified quality, quantity and display of maximum retail price of notified petroleum, petroleum products and natural gas including CNG and such other obligations, as may be specified by regulations;

(zl) "rules" means rules made by the Central Government under this Act;

(zm) "Secretary" means the Secretary of the Board;

(zn) "transportation rate", in relation to common carrier or contract carrier or a city or local natural gas distribution network, means such rate for moving each unit of petroleum, petroleum products or natural gas as may be fixed by regulations.

CHAPTER II

PETROLEUM AND NATURAL GAS REGULATORY BOARD

3. Establishment and incorporation of the Board :-

(1)  With effect from such date as the Central Government may, by notification, appoint, there shall be established, for the purposes of this Act, a Board to be called the Petroleum and Natural Gas Regulatory Board.

(2) The Board shall be a body corporate by the name aforesaid, having perpetual succession and a common seal, with power, subject to the provisions of this Act, to acquire, hold and dispose of property, both movable and immovable, and to contract, and shall, by the said name, issue or be issued.

(3) The Board shall consist of a Chairperson, a Member (Legal) and three other members to be appointed by the Central Government.

(4) The head office of the Board shall be at New Delhi and regional offices at such places as the Board may deem necessary having regard to public interest and magnitude of the work.

4. Qualifications for appointment of Chairperson and other members :-

 (1)The Central Government shall appoint the Chairperson and other members of the Board from amongst persons of eminence in the fields of petroleum and natural gas industry, management, finance, law, administration or consumer affairs : Provided that no person shall be appointed as Member (Legal) unless he-

(a) is qualified to be a Judge of a High Court; or

(b) has been a member of the Indian Legal Service and has held a post in Grade I of that Service for at least three years.

  (2)The Central Government shall, for the purposes of selecting the Chairperson and after members of the Board and for preparing a panel of persons to be considered for appointment as the Technical Member (Petroleum and Natural Gas) of the Appellate Tribunal, constitute a Search Committee consisting of-

(i) Member, Planning Commission in charge of the energy sector - Chairperson;

(ii) Secretary to the Government of India, Ministry of Petroleum and Natural Gas - Member;

(iii) Secretary to the Government of India, Ministry of Finance, Department of Economic Affairs - Member;

(iv) Secretary to the Government of India in charge of Commerce, Ministry of Commerce and Industry - Member; and

(v) Secretary to the Government of India, Department of Legal Affairs, Ministry of Law and Justice - Member.

5. Term of office, conditions of service, etc. of Chairperson and other members :-

(1) Before appointing any person as the Chairperson or other member, the Central Government shall satisfy itself that such person does not have any financial or other interest which is likely to affect prejudicially his functions as Chairperson or such other member.

(2) The Chairperson and other members shall hold office for a term of five years from the date on which they enter upon their offices or until they attain the age of sixty-five years, whichever is earlier: Provided that the Chairperson and other members shall not be eligible for re-appointment.

Explanation :- For the purposes of this section, appointment of a member as Chairperson shall not be deemed to be re-appointment.

(3) A person in the service of the Central Government, a State Government or an undertaking, corporation or company owned or controlled by the Central Government or a State Government or from any other non-Governmental or corporate body shall resign or retire from such service before joining as the Chairperson or other member, as the case may be.

(4) The salaries and allowances payable to and the other terms and conditions of service of the Chairperson and the other members shall be such as may be prescribed: Provided that neither the salary and allowances nor the other terms and conditions of service of the Chairperson or any other member shall be varied to his disadvantage after appointment.

(5) The Chairperson or other member may resign his office by giving notice thereof in writing to the Central Government and on such resignation being accepted, the Chairperson or such other member shall be deemed to have vacated his office.

(6) The Chairperson or any other member, upon ceasing to hold office as such, shall-

(a) be ineligible for further employment under the Central Government or any State Government; and

(b) not accept any commercial employment for a period of two years from the date he ceases to hold such office.

Explanation.-For the purposes of this section, "commercial employment" means employment in any capacity under, or agency of, a person engaged in trading, commercial, industrial or financial business in any field and includes also a director of a company or partner of a firm or setting up practice either independently or as partner of a firm or as an advisor or a consultant.

6. Powers of Chairperson :-

The Chairperson shall have the powers of general superintendence and directions in the conduct of the affairs of the Board and shall, in addition to presiding over the meetings of the Board, exercise and discharge such other powers and functions of the Board, as may be assigned to him by the Board.

7. Removal of Chairperson or any other member from office :-

The Central Government may remove from office the Chairperson or any other member, who-

(a) has been adjudged as insolvent; or

(b) has been convicted of an offence which, in the opinion of the Central Government, involves moral turpitude; or

(c) has become physically or mentally incapable of acting as a member; or

(d) has acquired such financial or other interest as is likely to affect prejudicially his functions as a member; or

(e) has so abused his position as to render his continuance in office prejudicial to the public interest: Provided that no Chairperson or other member shall be removed from office under clause (d) or clause (e) unless the Central Government, after holding an inquiry by any person appointed or authority constituted for the purpose and in accordance with such procedure as may be prescribed in this behalf, is satisfied that such person ought on such ground or grounds to be removed.

8. Meetings of the Board :-

(1) The Board shall meet at such times and places, and shall observe such procedure in regard to the transaction of business at its meetings (including the quorum at such meetings) as may be provided by regulations.

(2) The Chairperson or, if he is unable to attend a meeting of the Board, the senior-most member present, reckoned from the date of appointment to the Board, shall preside at the meeting: Provided that in case of common date of appointment of members, the member senior in age shall be considered as senior to the other members.

(3) All questions which come up before any meeting of the Board shall be decided by a majority of the members present and voting, and in the event of an equality of votes, the Chairperson or in his absence, the person presiding shall have a second or casting vote.

(4) All orders and decisions of the Board shall be authenticated by the Secretary or any other officer of the Board duly authorised by the Chairperson in this behalf.

9. Vacancies, etc., not to invalidate proceedings of the Board :-

  No act or proceeding of the Board shall be invalid merely by reason of –

(a) any vacancy in, or any defect in the constitution of, the Board; or

(b) any defect in the appointment of a person acting as a member of the Board; or

(c) any irregularity in the procedure of the Board not affecting the merits of the case.

10. Officers and other employees of the Board :-

(1) The Central Government may, in consultation with the Board, appoint a Secretary to exercise and perform such powers and duties, under the control of the Chairperson as may be specified by regulations: Provided that no such consultation shall be necessary for appointment of the first Secretary of the Board.

(2) The Board may, with the approval of the Central Government, determine the number, nature and categories of other officers and employees required to assist the Board in the efficient discharge of its functions.

(3) The salaries and allowances payable to and the other terms and conditions of service of the Secretary, the other officers and employees of the Board shall be such as may be prescribed.

(4) The Board may appoint consultants required to assist in the discharge of its functions on such terms and conditions as may be determined by regulations.

CHAPTER III

FUNCTIONS AND POWERS OF THE BOARD

11. Functions of the Board :-

The Board shall-

(a) protect the interest of consumers by fostering fair trade and competition amongst the entities;

(b) register entities to-

(i) market notified petroleum and petroleum products and, subject to the contractual obligations of the Central Government, natural gas;

(ii) establish and operate liquefied natural gas terminals;

(iii) establish storage facilities for petroleum, petroleum products or natural gas exceeding such capacity as may be specified by regulations;

(c) authorise entities to-

(i)   lay, build, operate or expand a common carrier or contract carrier;

(ii) lay, build, operate or expand city or local natural gas distribution network;

(d) declare pipelines as common carrier or contract carrier;

(e) regulate, by regulations,-

(i) access to common carrier or contract carrier so as to ensure fair trade and competition amongst entities and for that purpose specify pipeline access code;

(ii) transportation rates for common carrier or contract carrier;

(iii) access to city or local natural gas distribution network so as to ensure fair trade and competition amongst entities as per pipeline access code;

(f) in respect of notified petroleum, petroleum products and natural gas-

(i)  ensure adequate availability;

(ii) ensure display of information about the maximum retail prices fixed by the entity for consumers at retail outlets;

(iii) monitor prices and take corrective measures to prevent restrictive trade practice by the entities;

(iv) secure equitable distribution for petroleum and petroleum products;

(v) provide, by regulations, and enforce, retail service obligations for retail outlets and marketing service obligations for entities;

(vi)monitor transportation rates and take corrective action to prevent restrictive trade practice by the entities;

(g) levy fees and other charges as determined by regulations;

(h) maintain a data bank of information on activities relating to petroleum, petroleum products and natural gas;

(i) lay down, by regulations, the technical standards and specifications including safety standards in activities relating to petroleum, petroleum products and natural gas, including the construction and operation of pipeline and infrastructure projects related to downstream petroleum and natural gas sector;

(j) perform such other functions as may be entrusted to it by the Central Government to carry out the provisions of this Act.

12. Powers regarding complaints and resolutions of disputes by the  Board :-

(1) The Board shall have jurisdiction to-

(a) adjudicate upon and decide any dispute or matter arising amongst entities or between an entity and any other person on issues relating to refining, processing, storage, transportation, distribution, marketing and sale of petroleum, petroleum products and natural gas according to the provisions of Chapter V, unless the parties have agreed for arbitration;

(b) receive any complaint from any person and conduct any inquiry and investigation connected with the activities relating to petroleum, petroleum products and natural gas on contravention of-

(i) retail service obligations;

(ii) marketing service obligations;

(iii) display of retail price at retail outlets;

(iv) terms and conditions subject to which a pipeline has been declared as common carrier or contract carrier or access for other entities was allowed to a city or local natural gas distribution network, or authorisation has been granted to an entity for laying, building, expanding or operating a pipeline as common carrier or contract carrier or authorisation has been granted to an entity for laying, building, expanding or operating a city or local natural gas distribution network;

(v) any other provision of this Act or the rules or the regulations or orders made there under.

(2) While deciding a complaint under sub-section (1), the Board may pass such orders and issue such directions as it deems fit or refer the matter for investigation according to the provisions of Chapter V.

13. Procedure of the Board :-

(1) The Board shall have, for the purposes of discharging its functions under this Act, the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 (5 of 1908), while trying a suit, in respect of the following matters, namely:-

(a) summoning and enforcing the attendance of any person and examining him on oath;

(b) subject to the provisions of sections 123 and 124 of the Indian Evidence Act, 1872 (1 of 1872), requisitioning any public record or document or a copy of such record or document, from any office and production of such documents;

(c) receiving evidence on affidavits;

(d) issuing commissions for the examination of witnesses or documents;

(e) dismissing an application for default or deciding it, ex parte;

(f) setting aside any order of dismissal of any application for default or any order passed by it, ex parte;

(g) granting interim relief;

(h) reviewing its decision; and

(i) any other matter which may be prescribed.

(2) Every proceeding before the Board shall be deemed to be a judicial proceeding within the meaning of sections 193 and 228, and for the purposes of section 196, of the Indian Penal Code (45 of 1860) and the Board shall be deemed to be a civil court for the purposes of section 195 and Chapter XXVI of the Code of Criminal Procedure, 1973 (2 of 1974).

(3) The Board shall be guided by the principles of natural justice and subject to other provisions of this Act and of any rules made there under, shall have powers to regulate its own procedure including the places at which it shall conduct its business.

CHAPTER IV

REGISTRATION AND AUTHORISATION

14. Register :-

(1) For the purposes of this Act, a register to be called the Petroleum and Natural Gas Register shall be kept at the head office of the Board containing such details of entities-

(a) registered for-

   (i) marketing notified petroleum, petroleum products or natural gas, or

  (ii) establishing and operating liquefied natural gas terminals, or

 (iii) establishing storage facilities for petroleum, petroleum products or natural gas  exceeding such capacity as may be specified by regulations.

(b) authorised for -

   (i) laying, building, operating or expanding a common carrier, or

  (ii)laying, building, operating or expanding a city or local natural gas distribution    network, as may be provided by the Board by regulations.

(2) A copy of any entry in the register purporting to be maintained by the Board and certified as such by an officer authorised by the Board, shall be admitted in evidence in all courts and in all proceedings without further proof or production of the original.

(3) The register shall be open to public inspection at the head office of the Board.

(4) Any person may, on application to the Board, and on payment of such fee as may be determined by the Board, by regulations, obtain a certified copy of any entry in the register.

15. Registration of entities :-

(1) Every entity desirous of-

(a) marketing any notified petroleum or petroleum products or natural gas; or

(b) establishing or operating a liquefied natural gas terminal; or

(c) establishing storage facilities for petroleum, petroleum products or natural gas exceeding such capacity as may be specified by regulations, and fulfilling the eligibility conditions as may be prescribed shall make an application to the Board for its registration under this Act: Provided that no registration under this Act shall be required for any entity carrying on any activity referred to in clause (a) or clause (b) or clause (c) immediately before the appointed day but shall inform the Board about such activity within six months from the appointed day.

(2) Every application for registration under sub-section (1) shall be made in such form and in such manner and shall be accompanied by such fee as may be determined by the Board by regulations.

(3) The Board may, after making such enquiry and subject to such terms and conditions as it may specify, grant a certificate of registration to the entity allowing to commence and carry on the activity referred to in clause (a) or clause (b) or clause (c), as the case may be, of sub-section (1).

(4) The Board may, by order, suspend or cancel a certificate of registration granted under sub-section (3) in such manner as may be determined by regulations : Provided that no order under this sub-section shall be made unless the entity concerned has been given a reasonable opportunity of being heard.

16. Authorisation :-

No entity shall-

(a) lay, build, operate or expand any pipeline as a common carrier or contract carrier,

(b) lay, build, operate or expand any city or local natural gas distribution network, without obtaining authorisation under this Act : Provided that an entity :-

    (i) laying, building, operating or expanding any pipeline as common carrier  or contract carrier; or

   (ii) laying, building, operating or expanding any city or local natural gas distribution network, immediately before the appointed day shall be deemed to have such authorisation subject to the provisions of this Chapter, but any change in the purpose or usage shall require separate authorisation granted by the Board.

17. Application for authorisation :-

(1)  An entity which is laying, building, operating or expanding, or which proposes to lay, build, operate or expand, a pipeline as a common carrier or contract carrier shall apply in writing to the Board for obtaining an authorisation under this Act :Provided that an entity laying, building, operating or expanding any pipeline as common carrier or contract carrier authorised by the Central Government at any time before the appointed day shall furnish the particulars of such activities to the Board within six months from the appointed day.

(2)  An entity which is laying, building, operating or expanding, or which proposes to lay, build, operate or expand, a city or local natural gas distribution network shall apply in writing for obtaining an authorisation under this Act : Provided that an entity laying, building, operating or expanding any city or local natural gas distribution network authorised by the Central Government at any time before the appointed day shall furnish the particulars of such activities to the Board within six months from the appointed day.

(3)   Every application under sub-section (1) or sub-section (2) shall be made in such form and in such manner and shall be accompanied with such fee as the Board may, by regulations, specify.

(4)  Subject to the provisions of this Act and consistent with the norms and policy guidelines laid down by the Central Government, the Board may either reject or accept an application made to it, subject to such amendments or conditions, if any, as it may think fit.

(5)  In the case of refusal or conditional acceptance of an application, the Board shall record in writing the grounds for such rejection or conditional acceptance, as the case may be.

18. Publicity of applications :-

When an application for registration for marketing notified petroleum, petroleum products and natural gas, or for establishing and operating a liquefied natural gas terminal, or for establishing storage facilities for petroleum, petroleum products or natural gas exceeding such capacity as may be specified by regulations, is accepted whether absolutely or subject to conditions or limitations, the Board shall, as soon as may be, cause such acceptance to be known to the public in such form and manner as may be provided by regulations.

19. Grant of authorisation :-

(1) When, either on the basis of an application for authorisation for laying, building, operating or expanding a common carrier or contract carrier or for laying, building, operating or expanding a city or local natural gas distribution network is received or on sue motto basis, the Board forms an opinion that it is necessary or expedient to lay, build, operate or expand a common carrier or contract carrier between two specified points, or to lay, build, operate or expand a city or local natural gas distribution network in a specified geographic area, the Board may give wide publicity of its intention to do so and may invite applications from interested parties to lay, build, operate or expand such pipelines or city or local natural gas distribution network.

(2) The Board may select an entity in an objective and transparent manner as specified by regulations for such activities.

20. Declaring, laying, building, etc., of common carrier or contract carrier and city or local natural gas distribution network :-

(1) If the Board is of the opinion that it is necessary or expedient, to declare an existing pipeline for transportation of petroleum, petroleum products and natural gas or an existing city or local natural gas distribution network, as a common carrier or contract carrier or to regulate or allow access to such pipeline or network, it may give wide publicity of its intention to do so and invite objections and suggestions within a specified time from all persons and entities likely to be affected by such decision.

(2) For the purposes of sub-section (1), the Board shall provide the entity owning, the pipeline or network an opportunity of being heard and fix the terms and conditions subject to which the pipeline or network may be declared as a common carrier or contract carrier and pass such orders as it deems fit having regard to the public interest, competitive transportation rates and right of first use.

(3) The Board may, after following the procedure as specified by regulations under section 19 and sub-sections (1) and (2), by notification,-

(a) declare a pipeline or city or local natural gas distribution network as a common carrier or contract carrier; or

(b) authorise an entity to lay, build, operate or expand a pipeline as a common carrier or contract carrier; or

(c) allow access to common carrier or contract carrier or city or local natural gas distribution network; or

(d) authorise an entity to lay, build, operate or expand a city or local natural gas distribution network.

(4) The Board may decide on the period of exclusivity to lay, build, operate or expand a city or local natural gas distribution network for such number of years as it may by order, determine in accordance with the principles laid down by the regulations made by it, in a transparent manner while fully protecting the consumer interests.

(5) For the purposes of this section, the Board shall be guided by the objectives of promoting competition among entities, avoiding in fructuous investment, maintaining or increasing supplies or for securing equitable distribution or ensuring adequate availability of petroleum, petroleum products and natural gas throughout the country and follow such principles as the Board may, by regulations, determine in carrying out its functions under this section.

21. Right of first use, etc :-

 (1)The entity laying, building, operating or expanding a pipeline for transportation of petroleum and petroleum products or laying, building, operating or expanding a city or local natural gas distribution network shall have right of first use for its own requirement and the remaining capacity shall be used amongst entities as the Board may, after issuing a declaration under section 20, determine having regard to the needs of fair competition in marketing and availability of petroleum and petroleum products throughout the country: Provided that in case of an entity engaged in both marketing of natural gas and laying, building, operating or expanding a pipeline for transportation of natural gas on common carrier or contract carrier basis, the Board shall require such entities to comply with the affiliate code of conduct as may be specified by regulations and may require such entity to separate the activities of marketing of natural gas and the transportation including ownership of the pipeline within such period as may be allowed by the Board and only within the said period, such entity shall have right of first use.

(2)  An entity other than an entity authorised to operate shall pay transportation rate for use of common carrier or contract carrier to the entity operating it as an authorised entity.

(3) An entity authorised to lay, build, operate or expand a pipeline as common carrier or contract carrier or to lay, build, operate or expand a city or local natural gas distribution network shall be entitled to institute proceedings before the Board to prevent, or to recover damages for, the infringement of any right relating to authorisation.

      Explanation :- For the purposes of this sub-section, "infringement of any right" means doing of any act by any person which interferes with common carrier or contract carrier or causes prejudice to the authorised entity.

22. Transportation tariff :-

(1) Subject to the provisions of this Act, the Board shall lay down, by regulations, the transportation tariffs for common carriers or contract carriers or city or local natural gas distribution network and the manner of determining such tariffs.

(2) For the purposes of sub-section (1), the Board shall be guided by the following, namely:-

(a) the factors which may encourage competition, efficiency, economic use of the  resources, good performance and optimum investments;

(b) safeguard the consumer interest and at the same time recovery of cost of  transportation in a reasonable manner;

  

(c) the principles rewarding efficiency in performance;

(d) the connected infrastructure such as compressors, pumps, metering units, storage and the like connected to the common carriers or contract carriers;

(e) benchmarking against a reference tariff calculated based on cost of service, internal rate of return, net present value or alternate mode of transport;

(f) policy of the Central Government applicable to common carrier, contract carrier and city or local distribution natural gas network.

23. Suspension or cancellation of authorisation :-

If the Board, on an application of an affected party or on its own motion, is satisfied that the entity in favour of which authorisation has been granted under section 19 has failed to comply with any conditions of authorisation, it may, after giving an opportunity to such entity of being heard, either suspend the authorisation for such period as the Board may think fit or cancel the authorisation: Provided that where the Board is of the opinion that an authorised entity persistently acts in a manner prejudicial to the interests of consumers, it may take action for the suspension of the authorisation immediately subject to the opportunity of hearing being given subsequently, after which action so taken may be confirmed or revoked.

CHAPTER V

SETTLEMENT OF DISPUTES

24. Board to settle disputes :-

(1) Save as otherwise provided for arbitration in the relevant agreements between entities or between an entity or any other person, as the case may be, if any dispute arises, in respect of matters referred to in sub-section(2) among entities or between an entity and any other person, such dispute shall be decided by a Bench consisting of the Member (Legal) and one or more members nominated by the Chairperson: Provided that if the members of the Bench differ on any point or points, they shall state the point or points on which they differ and refer the same to a member other than a member of the Bench for hearing on such point or points and such point or points shall be decided according to the opinion of that member.

(2) The Bench constituted under sub-section (1) shall exercise, on and from the appointed day, all such jurisdiction, powers and authority as were exercisable by a civil court on any matter relating to –

 (a)refining, processing, storage, transportation and distribution of petroleum, petroleum products and natural gas by the entities;

 (b) marketing and sale of petroleum, petroleum products and natural gas including the quality of service and security of supply to the consumers by the entities; and

 (c) registration or authorisation issued by the Board under section 15 or  section 19.

(3) Notwithstanding anything contained in the Code of Civil Procedure, 1908 (5 of 1908), the Board shall have the power to decide matters referred to in sub-section (2) on or after the appointed day.

25. Filing of complaints :-

(1) A complaint may be filed before the Board by any person in respect of matters relating to entities or between entities on any matter arising out of the provisions of this Act: Provided that the complaints of individual consumers maintainable before a consumer disputes redress forum under the Consumer Protection Act, 1986 (68 of 1986) shall not be taken up by the Board but shall be heard and disposed of by such forum. Explanation.-For the purposes of this sub-section, the expression "consumer disputes redress forum" shall mean the district forum, State Commission or, the National Commission, as the case may be, constituted under the provisions of the Consumer Protection Act, 1986 (68 of 1986).

(2) Every complaint made under sub-section (1) shall be filed within sixty days from the date on which any act or conduct constituting a contravention took place and shall be in such form and shall be accompanied by such fee as may be provided by regulations : Provided that the Board may entertain a complaint after the expiry of the said period if it is satisfied that there was sufficient cause for not filing the complaint within that period.

(3) On receipt of a complaint under sub-section (1), the Board shall decide within thirty days whether there is a prima facie case against the entity or entities concerned and may either conduct enquiry on its own or refer the matter for investigation under this Chapter, to an Investigating Officer having jurisdiction; and, where the matter is referred to such Investigating Officer, on receipt of a report from such Investigating Officer, the Board may, hear and dispose of the complaint as a dispute if it falls under sub-section (2) of section 27 and in any other case, it may pass such orders and issue such directions as it deems fit.

(4) Where the Central Government considers that a matter arising out of the provisions of this Act is required to be investigated, it shall make a reference to the Board and the provisions of this Act shall apply as if such reference were a complaint made to the Board.

26. Power to investigate (Settle Dispute):-

(1) For the purposes of provisions of section 25, the Board shall, subject to the provisions of sub-section (3), appoint by general or special order, an officer of the Board as an Investigating Officer for holding an investigation in the manner provided by regulations : Provided that where the Board considers it necessary that the matter should be investigated by any investigating agency of the State or Central Government including the special police force constituted under section 2 of the Delhi Special Police Establishment Act, 1946, the Board may request the concerned Government for directing or authorizing such agency to investigate and the agency so directed or authorised shall, then, be competent to exercise the powers and to discharge the duties of an Investigating Officer under this Act.

(2) No person shall be appointed as an Investigating Officer unless he possesses such qualifications and experience as may be determined by the Board by regulations.

(3) Where more than one Investigating Officer is appointed, the Board shall specify, by order, the matters and the local limits of jurisdiction with respect to which each such officer shall exercise his jurisdiction.

27. Factors to be taken into account by the Board :-

The Board shall, while deciding a dispute under this Chapter, have due regard to the provisions of this Act and to the following factors, namely:-

(a) the amount of disproportionate gain made or unfair advantage derived, wherever quantifiable, as a result of the default;

(b) the amount of loss caused to an entity as a result of the default;

(c) the repetitive nature of the default.

28. Civil penalty for contravention of directions given by the Board :-

In case any complaint is filed before the Board by any person or if the Board is satisfied that any person has contravened a direction issued by the Board under this Act to provide access to, or to adhere to the transportation rate in respect of a common carrier,

or to display maximum retail price at retail outlets, or violates the terms and conditions subject to which registration or authorisation has been granted under section 15 or section 19 or the retail service obligations or marketing service obligations, or does not furnish information, document, return of report required by the Board, it may, after giving such person an opportunity of being heard in the matter, by order in writing, direct that, without prejudice to any other penalty to which he may be liable under this Act, such person shall pay, by way of civil penalty an amount which shall not exceed one crore rupees for each contravention and in case of a continuing failure with additional penalty which may extend to ten lakh rupees for every day during which the failure continues after contravention of the first such direction : Provided that in the case of a complaint on restrictive trade practice, the amount of civil penalty may extend to five times the unfair gains made by the entity or ten crore rupees, whichever is higher.

29. Orders passed by Board deemed to be decrees :- 

Every order made by the Board under this Act shall, on a certificate issued by an officer of the Board, shall be executable in the same manner as if it were a decree of a civil court : Provided that where an appeal lies against an order of the Board and no appeal is preferred then the order of the Board shall be deemed to be a final decree under this section on the expiry of the period allowed for preferring an appeal against such order before the Appellate Tribunal.

CHAPTER VI

APPEALS TO APPELLATE TRIBUNAL

30. Appellate Tribunal :-

(1) Subject to the provisions of this Act, the Appellate Tribunal established under section 110 of the Electricity Act, 2003 (36 of 2003) shall be the Appellate Tribunal for the purposes of this Act and the said Appellate Tribunal shall exercise the jurisdiction, powers and authority conferred on it by or under this Act : Provided that the Technical Member of the Appellate Tribunal for the purposes of this Act shall be called the Technical Member (Petroleum and Natural Gas) and shall have the qualifications specified in subsection (2) of section 31.

(2) Notwithstanding anything contained in the Electricity Act, 2003 (36 of 2003), the Central Government may, for the purposes of this Act, appoint one or more Technical Members (Petroleum and Natural Gas) on the Appellate Tribunal for Electricity or designate a Technical Member of the said Tribunal having the qualifications specified in sub-section (2) of section 31 and when a Technical Member (Petroleum and Natural Gas) is appointed, he shall be in addition to the three other members appointed under the said Act.

31. Technical Member (Petroleum and Natural Gas) :-

(1) The Technical Member (Petroleum and Natural Gas) shall be appointed from the panel prepared by the Search Committee constituted under sub-section (2) of section 4.

(2) A person shall not be qualified for appointment as a Technical Member (Petroleum and Natural Gas) of the Appellate Tribunal unless he-

(i) is, or has been, a Secretary for at least one year in the Ministry or Department of the Central Government having adequate experience in energy sector, especially in matters relating to Petroleum and Natural Gas sector; or

(ii) is, or has been, a person of ability and standing, having adequate knowledge or experience in dealing with matters relating to exploration, production, transmission pipelines, marketing or regulation of petroleum, petroleum products or natural gas, economics, commerce, law or management.

32. Terms and conditions of service of Technical Member (Petroleum and Natural  Gas) :-

The term of office, the salaries and allowances payable to and the other terms and conditions of service of the Technical Member (Petroleum and Natural Gas) shall be the same as applicable to the other members of the Appellate Tribunal.

33. Appeals to Appellate Tribunal :-

(1) Any person aggrieved by an order or decision made by the Board under this Act may prefer an appeal to the Appellate Tribunal : Provided that any person preferring an appeal against an order or decision of the Board levying any penalty shall, while filing the appeal, deposit the amount of such penalty : Provided further that where in any particular case, the Appellate Tribunal is of the opinion that deposit of such penalty would cause undue hardship to such person, it may dispense with such deposit subject to such conditions as it may deem fit to impose so as to safeguard the realisation of penalty.

(2) Every appeal under sub-section (1) shall be filed within a period of thirty days from the date on which a copy of the direction or order of decision made by the Board is received by the aggrieved person and it shall be in such form, verified in such manner and be accompanied by such fee as may be prescribed : Provided that the Appellate Tribunal may entertain an appeal after the expiry of the said period of thirty days if it is satisfied that there was sufficient cause for not filing it within that period.

(3) On receipt of an appeal under sub-section (1), the Appellate Tribunal may, after giving the parties an opportunity of being heard, pass such orders thereon as it thinks fit.

(4) The Appellate Tribunal shall send a copy of every order made by it to the parties to the appeal and to the Board.

(5) The appeal filed under sub-section (1) shall be dealt with by the Appellate Tribunal as expeditiously as possible and endeavor shall be made by it to dispose of the appeal finally within ninety days from the date of receipt of appeal: Provided that where any such appeal could not be disposed of within the said period of ninety days, the Appellate Tribunal shall record its reasons in writing for not disposing of the appeal within the said period.

(6) The Appellate Tribunal may, for the purpose of examining the legality or propriety or correctness of any order or decision of the Board referred to in the appeal filed under sub-section (1), either on its own motion or otherwise, call for the records relevant to disposing of such appeal and make such orders as it thinks fit.

34. Procedure and powers of the Appellate Tribunal :-

The provisions of sections 120 to 124 (both inclusive) of the Electricity Act, 2003 (36 of 2003) shall mutatis mutandis apply to the Appellate Tribunal in the discharge of its functions under this Act as they apply to it in the discharge of its functions under the Electricity Act, 2003.

35. Power of Appellate Tribunal to make rules :-

The Appellate Tribunal may, by notification, make rules consistent with the provisions of this Act as to the conduct and procedure in respect of all proceedings before it under this Act.

36. Orders passed by Appellate Tribunal to be executable as a decree :-

(1) Every order made by the Appellate Tribunal under this Act shall be executable by the Appellate Tribunal as a decree of a civil court, and for this purpose, the Appellate Tribunal shall have all the powers of a civil court.

(2) Notwithstanding anything contained in sub-section (1), the Appellate Tribunal may transmit any order made by it to a civil court having jurisdiction and such civil court shall execute the order as if it were a decree made by that court.

37. Appeal to Supreme Court :-

(1) Notwithstanding anything contained in the Code of Civil Procedure, 1908 (5 of 1908) or in any other law, an appeal shall lie against any order, not being an interlocutory order, of the Appellate Tribunal to the Supreme Court on one or more of the grounds specified in section 100 of that Code.

(2) No appeal shall lie against any decision or order made by the Appellate Tribunal with the consent of the parties.

(3) Every appeal under this section shall be preferred within a period of ninety days from the date of the decision or order appealed against : Provided that the Supreme Court may entertain the appeal after the expiry of the said period of ninety days, if it is satisfied that the appellant was prevented by sufficient cause from preferring the appeal in time.

CHAPTER VII

FINANCE, ACCOUNTS AND AUDIT

38. Grants by Central Government :-

The Central Government may, after due appropriation made by Parliament by law in this behalf, make to the Board grants of such sums of money as are required to pay salaries and allowances payable to the Chairperson and the other members and the administrative expenses including the salaries, allowances and pensions payable to the officers and employees of the Board.

39. Fund :-

(1) There shall be constituted a Fund to be called the Petroleum and Natural Gas Regulatory Board Fund and there shall be credited thereto-

(i)  all grants, fees, penalties and charges received by the Board under this Act; 

(ii) all sums received by the Board from such other sources as may be approved by the Central Government.

(2) The Fund shall be applied for making payments towards –

(i) the salaries and allowances payable to the Chairperson and other members and the administrative expenses including the salaries, allowances and pensions payable to the officers and employees of the Board;

          

(ii) the expenses incurred or to be incurred in carrying out the provisions of this  Act.

(3) The Central Government shall-

(i) constitute a committee consisting of such persons as it thinks fit to recommend to that Government the budgetary requirements of the Board for salaries, allowances and all other expenses; and

(ii) fix the budgetary ceiling of the Board on the basis of the recommendations of the committee.

40. Accounts and audit :-

(1) The Board shall maintain proper accounts and other relevant records and prepare an annual statement of accounts in such form as may be prescribed by the Central Government in consultation with the Comptroller and Auditor-General of India.

(2) The accounts of the Board shall be audited by the Comptroller and Auditor-General of India at such intervals as may be specified by him and any expenditure incurred in connection with such audit shall be payable by the Board to the Comptroller and Auditor-General of India. Explanation.-For the removal of doubts, it is hereby declared that the decisions of the Board taken in the discharge of its functions under this Act, being matters appeal able to the Appellate Tribunal, shall not be subject to audit under this section.

(3) The Comptroller and Auditor-General of India or any other person appointed by him in connection with the audit of the accounts of the Board shall have the same rights and privileges and authority in connection with the audit of the Government accounts and, in particular, shall have the right to demand the production of books, accounts, connected vouchers and other documents and papers and inspection of offices of the Board.

(4) The accounts of the Board as certified by the Comptroller and Auditor-General of India or any other person appointed by him in this behalf together with the audit report thereon shall be forwarded annually to the Central Government and that Government shall cause the same to be laid before each House of Parliament.

41. Annual report and its laying before Parliament :-

(1) The Board shall prepare once every year in such form and at such time as may be prescribed, an annual report giving a summary of its activities including information relating to the proceedings and policies during the previous years and such report shall also contain statements of annual accounts of the Board.

(2) A copy of the report shall be forwarded to the Central Government and the Central Government shall cause such report to be laid, as soon as may be after it is received, before each House of Parliament.

CHAPTER VIII

POWER OF CENTRAL GOVERNMENT

42. Power of Central Government to issue directions :-

(1) The Central Government may, from time to time, by writing issue to the Board such directions as it may think necessary in the interest of the sovereignty and integrity of India, the security of the State, friendly relations with foreign States or public order.

(2) Without prejudice to the foregoing provision, the Central Government may, if it finds necessary or expedient so to do in public interest or for maintaining or increasing supplies of petroleum, petroleum products or natural gas or all or any of them or for securing their equitable distribution and ensuring adequate availability, issue policy directives to the Board in writing and such policy directives shall be binding upon the Board : Provided that no such directive shall relate to any day-to-day affairs of the Board : Provided further that the Board shall, as far as practicable, be given an opportunity of expressing its views before any directive is issued under this sub-section.

(3) The decision of the Central Government whether a question is one of policy or not shall be final.

43. Taking over control and management of facilities and business premises of any entity and retail outlets in public interest :-

(1) In the event of war or natural calamity or such other similar circumstances leading to disruption of supply of petroleum, petroleum products or natural gas, the Central Government may, for ensuring the continuous supply of petroleum, petroleum products or natural gas, by notification, either take over the control and management of any storage site, facilities and business premises of any entity and retail outlets or suspend its operations or entrust, to any agency of the Central or State Government for such time and manage it in such manner, as may be specified in that notification : Provided that the affected entities shall be given an opportunity of being heard before issuing orders to take over the control and management of retail outlets and other business premises: Provided further that in case of any urgency or in cases where the circumstances do not permit serving of notice for want of sufficient time or otherwise upon the entity against whom the order is directed, the opportunity of hearing may be dispensed with in public interest in order to maintain the uninterrupted supply of petroleum, petroleum products or natural gas for a specified period.

(2) The collector of the revenue district in which the property referred to in the notification issued under sub-section (1) is situated shall determine the amount of compensation payable for taking over of the property.

(3) The form and manner in which an application for claiming compensation under this section shall be made, the procedure for determining the compensation and the time within which such compensation shall be payable, shall be such as may be prescribed.

CHAPTER IX

OFFENCES AND PUNISHMENT

44. Punishment for contravention of directions of the Board :-

If a person contravenes the directions of the Board, such person shall be punishable with fine which may extend to twenty-five crore rupees and in case of continuing contravention with additional fine which may extend to ten lakh rupees for every day during which the contravention continues.

45. Penalty for willful failure to comply with orders of Appellate Tribunal :

If any person willfully fails to comply with the order of the Appellate Tribunal, he shall be punishable with fine which may extend to one crore rupees and in case of a second or subsequent offence with fine which may extend to two crore rupees and in the case of continuing contravention with additional fine which may extend to twenty lakh rupees for every day during which such default continues.

46. Punishment for unauthorized activities :-

If any person, being an entity, markets any notified petroleum, petroleum products or natural gas without a valid registration, or authorisation such person shall be punishable with imprisonment which may extend to three years or with fine which may extend to twenty-five crore rupees or with both, and in case of continuing contravention with additional fine which may extend to ten lakh rupees for every day during which the contravention continues.

47. Punishment for establishing or operating a liquefied natural gas terminal without registration :-

If a person establishes or operates a liquefied natural gas terminal without registration as required under section 15, such person shall be liable for punishment with an imprisonment for a term which may extend to three years or penalty of twenty-five crore rupees or with both, and in case of continuing contravention with additional fine which may extend to ten lakh rupees for every day during which the contravention continues.

48. Punishment for laying, building, operating or expanding a common carrier or contract carrier without authorisation :-

If a person lays, builds, operates or expands a common carrier or contract carrier or a city or local natural gas distribution network without obtaining authorisation required under section 19, such person shall be liable for punishment with an imprisonment for a term which may extend to three years or penalty of twenty-five crore rupees or with both, and in case of continuing contravention with additional fine which may extend to ten lakh rupees for every day during which the contravention continues.

49. Punishment for willful damages to common carrier or contract carrier

Every person who willfully removes, destroys or damages any pipeline or city or local natural gas distribution network or other work of the common carrier or contract carrier for supplying petroleum, petroleum products or natural gas shall for each such offence be punishable with imprisonment which may extend to three years or with fine which may extend to twenty-five crore rupees or with both, and, in case of continuing contravention with additional fine which may extend to ten lakh rupees for every day during which such contravention continues.

50. Offences by companies :-

(1) Where an offence under this Act has been committed by a company, every person who at the time the offence was committed was in charge of, and was responsible to, the company for the conduct of the business of the company, as well as the company, shall be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly: Provided that nothing contained in this sub-section shall render any such person liable to any punishment provided in this Act, if he proves that the offence was committed without his knowledge or that he has exercised all due diligence to prevent the commission of such offence.

(2) Notwithstanding anything contained in sub-section (1), where an offence under this Act has been committed by a company and it is proved that the offence has been committed with the consent or connivance of, or is attributable to, any neglect on the part of any director, manager, secretary or other officer of the company, such director, manager, secretary or other officer shall also be deemed to be guilty of the offence and shall be liable to be proceeded against and punished accordingly.

     

      Explanation :- For the purpose of this section,-

(a)"company" means any body corporate and includes a firm or other association of individuals; and

(b) "director", in relation to a firm, means a partner in the firm.

CHAPTER X

MISCELLANEOUS

51. Maintenance of data bank and information :-

(1) The Board shall maintain a data bank and information system relating to activities of entities dealing with petroleum, petroleum products and natural gas in such form and manner as may be provided by regulations.

(2) The Board shall have power to verify the data supplied by the entities and appoint any person or persons for the purpose and take such measures as it may consider necessary.

52. Obligations of entities :-

(1) Every entity shall-

(a) maintain such documentary records as may be specified by the Board by regulations;

(b) allow inspection of such facilities and documentary records, as may be specified by the Board, by any person authorised by the Board;

(c) commence operation of activities for which authorisation has been granted within such period as may be specified by the Board in the document of authorisation;

(d) register-

(i) agreements with the Board relating to use of pipelines for supply of petroleum, petroleum products and natural gas; or

(ii) any other document which the Board may determine by regulations;

(e) comply with marketing service obligations and retail service obligations.

(2)The Board may call for any information from any entity including information which is considered necessary for ensuring transparency or ascertaining true ownership of the entity.

(3) The Board or any officer authorised by the Board shall have the power to inspect and obtain information, wherever necessary, from the entities.

(4) For the effective enforcement of the terms and conditions of authorisation, the Board or any officer authorised by it for that purpose, shall have all the powers of an inspecting officer as provided under section 209A of the Companies Act, 1956 (1 of 1956).

(5) It shall be the duty of every entity to carry out the directions of the Board given under this section.

(6) The Board shall maintain confidentiality in respect of any information and record received by it from the entities and shall not disclose information contained therein to any person or authority except on the grounds of public interest.

53. Furnishing of returns, etc., to Central Government :-

The Board shall furnish to the Central Government at such time and in such form and manner as may be prescribed or as the Central Government may direct, such returns and statements and such particulars in regard to any matter in connection with proposed or existing activities under this Act, as the Central Government may, from time to time, require.

54. Chairperson, members, etc., to be public servants :-

The Chairperson, Members, Officers and other employees of the Board and Technical Member (Petroleum and Natural Gas) of the Appellate Tribunal shall be deemed, when acting or purporting to act in pursuance of any of the provisions of this Act, to be public servants within the meaning of section 21 of the Indian Penal Code (45 of 1860).

55. Protection of action taken in good faith :-

No suit, prosecution or other legal proceeding shall lie against the Central Government, Board, Technical Authority or Appellate Tribunal or any officer of the Central Government or any Chairperson, Member, officer or other employee of the Board or Technical Member (Petroleum and Natural Gas) of the Appellate Tribunal for anything which is in good faith done or intended to be done under this Act or the rules or regulations made there under.

56. Civil courts not to have jurisdiction :-

No civil court shall have jurisdiction to entertain any suit or proceeding in respect of any matter which the Board or the Appellate Tribunal is empowered by or under this Act to determine, and no injunction shall be granted by any court or other authority in respect of any action taken or to be taken in pursuance of any power conferred by or under this Act.

57. Cognizance of certain offences :-

(1) No court shall take cognizance of any offence punishable under Chapter IX save on a complaint made by the Board or by any investigating agency directed by the Central Government.

(2) No court inferior to that of a Chief Metropolitan Magistrate or of a Chief Judicial Magistrate shall try any offence punishable under

 (3) Every offence punishable under sections 44, 45, 46 and 47 shall be cognizable.

58. Delegation :-

The Board may, by general or special order in writing, delegate to any member or officer of the Board subject to such conditions, if any, as may be specified in the order, such of its powers and functions under this Act (except the power to settle a dispute under Chapter VI and to make regulations under section 61), as it may deem necessary.

59. Power to remove difficulties :-

(1) If any difficulty arises in giving effect to the provisions of this Act, the Central Government may, by order, published in the Official Gazette, make such provisions not inconsistent with the provisions of this Act as it may deem necessary for removing the difficulty: Provided that no order shall be made under this section after the expiry of two years from the date of commencement of this Act.

(2) Every order made under this section shall be laid, as soon as may be after it is made, before each House of Parliament.

60. Power of Central Government to make rules :-

(1) The Central Government may, by notification, make rules for carrying out the provisions of this Act.

(2) In particular, and without prejudice to the generality of the foregoing power, such rules may provide for all or any of the following matters, namely:-

(a) the salaries and allowances payable to and the other conditions of service of the Chairperson and the other members under subsection (4) of section 5;

(b) the procedure for appointment of any person or constitution of any authority and conducting inquiry under section 7;

(c) the salaries and allowances payable to and the other terms and conditions of service of the Secretary, officers and other employees of the Board, under sub-section (3) of section 10;

(d) any other matter in respect of which the Board may exercise the powers of a civil court under clause (i) of sub-section (1) of section 13;

(e) the eligibility conditions which an entity shall fulfill for registration under sub-section (1) of section 15;

(f) the form of appeal and the manner of verifying such form, and the fee which shall accompany such form, under sub-section (2) of section 33;

(g) the manner in which the accounts of the Board shall be maintained under sub-section (1) of section 40;

(h) the time and manner in which the annual report of the Board shall be prepared under sub-section (1) of section 41;

(i) the form and manner in which applications for claiming compensation shall be made, the procedure for determining the compensation and the time within which such compensation shall be payable, under sub-section (3) of section 43;

(j) the time and manner in which returns and statements are to be furnished by the Board to the Central Government under section 53;

(k) any other matter which is to be, or may be, prescribed, or in respect of which provision is to be made, by rules.

61. Power of Board to make Regulations :-

(1) The Board may, by notification, make regulations consistent with this Act and the rules made there under to carry out the provisions of this Act.

(2) In particular, and without prejudice to the generality of the foregoing power, such regulations may provide for all or any of the following matters, namely:-

(a) the time and places of meetings of the Board and the procedure (including quorum necessary for the transaction of business) to be followed at such meetings under sub-section (1) of section 8;

(b) the powers and duties of the Secretary under sub-section (1) of section 10;

(c) the terms and conditions of the consultants appointed under subsection (4) of section 10;

(d) the capacity of storage facilities for petroleum, petroleum products or natural gas requiring registration under sub-clause(iii) of clause (b) of section 11;

(e) regulating open access to and transportation rate for the common carrier or contract carrier or city or local natural gas distribution network and other matters referred to in clause (e) of section 11;

(f) marketing service obligations for entities and retail service obligations for retail outlets under sub-clause(v) of clause(f) of section 11;

(g) levy of fees and other charges under clause (g) of section 11;

(h) the technical standards and specifications including safety standards in activities relating to petroleum, petroleum products and natural gas under clause (i) of section 11;

(i) the procedure to be followed by the Board including the places at which it shall conduct its business under sub-section (3) of section 13;

(j) the manner of maintaining the Petroleum and Natural Gas Register under sub-section (1) of section 14;

(k) the form and manner of making application for obtaining certified copy of any entry in the register and the fee which shall accompany such application, under sub-section (4) of section 14;

(l) the form and manner in which an application under sub-section(1) of section 15 shall be made and the fee which shall accompany such application under sub-section (2) of section 15;

(m) the manner by which a certificate of registration granted under sub-section (3) of section 15 may be suspended or cancelled under sub-section (4) of section 15;

(n) the form and manner in which an application under sub-section(1) or sub-section (2) of section 17 shall be made and the fee which shall accompany such application under sub-section (3) of section 17;

(o) the form and manner in which publicity of acceptance of applications for registration shall be made under section 18;

(p) the manner of selection of an entity under sub-section (2) of section 19;

(q) the principles for determining the number of years for which a city or local natural gas distribution network shall be excluded from the purview of a common carrier or contract carrier under sub-section (4) of section 20;

(r) the guiding principles to be followed by the Board and the objectives for declaring, or authorising to lay, build, operate or expand a common carrier or contract carrier for declaring, or authorising to lay, build, operate or expand a city or local natural gas distribution network, under sub-section (5) of section 20;

(s) the affiliate code of conduct under which the entities are required to comply with under the proviso to sub-section (1) of section 21;

(t) the transportation tariffs for common carriers or contract carriers or city or local natural gas distribution network and the manner of determining such tariffs under sub-section (1) of section 22;

(u) the form in which a complaint may be made and the fee which shall accompany such complaint, under sub-section (2) of section 25;

(v) the manner of holding an investigation by an Investigating Officer under sub-Section (1) of section 26;

(w) the qualifications and experience which any person for appointment as an Investigating Officer shall possess, under subsection (2) of section 26;

(x) the form and manner of maintaining data bank and information system by the Board under sub-section (1) of section 51;

(y) maintenance of documentary records by an entity, under clause (a) of sub-section (1) of section 52;

(z) any other type of documents which are to be registered with the Board under sub-clause (ii) of clause (d) of sub-section (1) of section 52;

(za)any other matter which is required to be, or may be, specified by regulations or in respect of which provision is to be or may be made by regulations.

62. Rules and regulations to be laid before Parliament :-

Every rule made by the Central Government and every regulation made by the Board under this Act shall be laid, as soon as may be after it is made, before each House of Parliament, while it is in session, for a total period of thirty days which may be comprised in one session or in two or more successive sessions, and if, before the expiry of the session immediately following the session or the successive sessions aforesaid, both Houses agree in making any modification in the rule or regulation or both Houses agree that the rule or regulation should not be made, the rule or regulation shall thereafter have effect only in such modified form or be of no effect, as the case may be; so, however, that any such modification or annulment shall be without prejudice to the validity of anything previously done under that rule or regulation.

63. Transitional arrangements :-

(1) Where, before the commencement of this Act, an agreement or agreements have been entered into between one oil company and another for the purpose of sharing of petroleum products or sharing of infrastructure facilities among the oil companies and such agreements have been approved by the Central Government, the Board may monitor the implementation of such agreements for the transition period.

(2) The Board shall monitor setting up of dealerships and distributorships of motor spirit, high speed diesel, superior kerosene oil, liquefied petroleum gas and CNG stations for natural gas during transition period by the entities without encroaching on the retail network of the existing entities.

Explanation I :- For the purposes of this section, the expression "transition period" shall mean a period of three years from the date of commencement of this Act.

Explanation II :- For the purposes of this section, "infrastructure facilities" shall mean facilities at ports, refineries, terminals, depots and aviation fuelling stations including hydrant lines and shall include loading and unloading facilities.

Explanation III.-For the purposes of this section "encroaching" includes taking over of retail outlet of one entity by another.

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K. N. CHATURVEDI,

Secy. to the Govt. of India.