IGL wants Delhi marketing monopoly till 2013

Vol 15, PW 13 (12 Jan 12) People & Policy

Indraprastha Gas (IGL) is fighting to retain its monopoly in the national capital for just a little bit longer.

PETROWATCH learns Delhi’s sole gas retailer wants the Petroleum and Natural Gas Regulatory Board (PNGRB) to extend its three-year ‘marketing exclusivity’ until July 2013. IGL originally received oil ministry authorisation for its Delhi gas network in January 2009, which means its ‘exclusivity’ period ends this month (January 2012).

This means any competitor could in theory begin accessing IGL’s pipeline network from February (next month) and use it to supply gas to customers after paying IGL access and usage fees. But IGL believes its exclusivity period should begin from July 15, 2010 - when the oil ministry passed into law the controversial Section 16 of the Petroleum & Natural Gas Regulatory Board Act, 2006 giving the gas regulator powers to govern companies in business before it was set up.

“Since the PNGRB got powers only in July 2010,” asserts an IGL source, “it can enforce ‘exclusivity’ only from that date.” IGL, he adds, has taken legal advice and written several letters to the PNGRB outlining its arguments; the last letter was sent in November.

But the PNGRB has not replied. When contacted, a PNGRB source speculates the organisation’s new chairman S.

Krishnan is hesitating to take a decision before the vacant member infrastructure and member tariff posts at the Board are filled. This should happen next month.

Still, the PNGRB did set up an eight-member panel last November to draw up guidelines on how India’s city gas networks should be run once their ‘exclusivity’ ends. Other than IGL, this panel also includes representatives from Mahanagar Gas, Adani, Aavantika Gas and Gujarat Gas, as well as state-owned consultant MECON.

A report from the eight-member panel is expected by the month-end.