Rejected LMJ Energy drags gas regulator to court

Vol 17, PW 4 (19 Sep 13) Midstream & Downstream
     

City gas newcomer LMJ Energy Infralogistics has challenged the PNGRB's decision to reject its bids for two cities under India's third retail gas licensing round, launched in 2010.

PETROWATCH learns LMJ filed a case against the Board with the Delhi-based Appellate Tribunal for Electricity (Aptel) on September 6 arguing the Board rejected its bid for Ludhiana in Punjab and Asansol-Durgapur in West Bengal after miscalculating its net worth. LMJ wants the court to quash its rejection and also wants price bids for the two cities to remain closed and their award delayed till the case is resolved.

“Our bids were rejected unfairly,” says LMJ. “We weren't given a chance to prove our case.

” Bidders were required to show a minimum net worth of Rs100cr ($15.7m). LMJ says it submitted a net worth of about Rs131cr ($20.6m) which the PNGRB did not accept, subsequently re-calculating the firm’s worth as only Rs98.51cr ($15.5m).

LMJ received a letter from the PNGRB on June 20, 2011 saying its net worth was inadequate for the Ludhiana bid. Nothing was mentioned about Asansol-Durgapur.

LMJ sent a clarification to the PNGRB four days later on June 24, 2011 but then heard nothing until July 31, 2013 when the PNGRB informed LMJ that its bids for both cities had been rejected. “Since we didn't receive any communication from the Board for two years, we thought our response had been accepted,” we hear.

LMJ is part of Kolkata-based traders LMJ International.

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