Gujarat government urges Charotar authorisation

Vol 13, PW 10 (22 Oct 09) Midstream & Downstream

Gujarat authorities are supporting Charotar Gas in its fight to continue selling piped gas as a cooperative.

Charotar is registered under the Gujarat Cooperative Societies Act, 1961, but earlier this year the Petroleum and Natural Gas Regulatory Board said it needed to be registered under the Companies Act, 1956, if it wanted to operate legally. PETROWATCH learns the Gujarat government sent a letter to Board chairman Labanyendu Mansingh requesting authorisation for Charotar on special grounds.

In his September 13 letter Gujarat energy and petrochemicals department principal secretary S. Jagadeesan highlights the good work that Charotar has done since it started selling gas in 1999.

“Charotar Gas has very good experience in the city gas distribution business,â€‌ writes Jagadeesan, “and is successfully supplying piped natural gas to 10 villages and towns in central Gujarat.â€‌ Charotar is “running successfully with good financial and managerial skills and capabilities,â€‌ adds the letter.

“Therefore the Board should consider Charotar Gas as a cooperative for the grant of authorisation.â€‌ Charotar’s managing director AJ Parmar welcomed the Gujarat government’s support.

“We are doing good work supplying small towns and villages where procuring fuel is a big headache for people,â€‌ says Parmar. “Gujarat’s government has endorsed our case and supported us wholeheartedly.

Is there anything wrong with thatâ€‌ Parmar adds Charotar could have put political pressure on the Board as former junior oil minister Dinsha Patel is from the same area. “But we don’t want to involve politicians,â€‌ says Parmar.

Other gas retailers will be watching the Board’s decision closely – especially Vadodara Municipal Corporation (VMC), which last week bypassed the problem of registration under the Companies Act by signing a JV with GAIL. “If the Board decides against Charotar,â€‌ we hear, “it will have two options – close down or follow VMC’s example.