IOC under scrutiny for 'illegal' LPG pipeline

Vol 20, PW 2 (06 Oct 16) People & Policy

IndianOil is facing charges it laid an LPG pipeline unilaterally without bidding and in so doing violated the Petroleum and Natural Gas Regulatory Board (PNGRB) Act, 2006.

On October 6, the gas regulator is set to rule on a complaint by Mumbai-based H-Energy alleging that IOC broke the law by beginning work in 2010 to lay a 670-km LPG pipeline from Paradip in Orissa to Durgapur in West Bengal without authorisation. H-Energy wants the PNGRB to bar IOC from all auctions for a stipulated period and to declare any pending bids by the company and its partners invalid.

H-Energy also wants the PNGRB to sanction relevant officials - including PNGRB member KK Jha, a former IOC director pipelines. H-Energy blames Jha directly, referring to a June 10, 2010 press report where he was quoted saying the IOC Board had approved the project and financial clearance would be discussed at an October-November 2010 Board meeting.

H-Energy argues the announcement was made two years and eight months after the PNGRB was set up, obliging IOC to seek formal permission. H-Energy adds the PNGRB released a notice on September 1, 2010 that any company wishing to lay, build, operate or expand a petroleum products pipeline must submit an EoI and that this was repeated in a November 3, 2010 public notice and a reminder on February 1, 2011.

In the notices, the PNGRB said any violation would attract penalties.

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