Mansingh advised by industry to begin with clean slate

Vol 11, PW 11 (04 Oct 07) People & Policy

Constantly under the spotlight, the new downstream petroleum and natural gas regulator Labanyendu Mansingh is offered a regular stream of advice on how best to do his job.

Some believe he should begin with a â€کclean slate’, and discard anything written before June 25, when his office became a legal entity with its â€کnotification’ in the Gazette of India, the official recorder of government policy. “Any drafts made before June 25,â€‌ says a source, “were not done by the Board and have no legal sanctity.

â€‌ Late last year, the oil ministry began a consultation process with oil and gas industry representatives to kick-start the exercise of drafting regulations for the gas sector. “The regulator was not in place at that time,â€‌ says a source.

“Many companies might not have sent in their views.â€‌ Ideally, says a source in a multinational, the regulator has to do his own thinking.

“If he can’t do this, he’s not good at the job,â€‌ we hear. “A good regulator will also listen to voices from industry and other interested sections.

â€‌ Totally unworkable, however, “is massive consultations with 80 people in a room.â€‌ In that sense, continues this source, having advisory panels is a good idea, in principle.

“But you must staff and head these panels with genuine industry representatives,â€‌ we hear. “Having GAIL or IOC head these panels is a joke.

â€‌ GAIL is an interested party with vested interests “and must have a seat at the table but not at the head.â€‌ It is a bit like, “putting BG in charge of such a job in the UK.

â€‌ The regulator should not, we are told, “waste time listening to monopolies like GAIL.â€‌ Nor should the regulator waste time with consultants like PWC, CRISIL, and Ernst & Young.

“These people are good at presenting academic papers at conferences,â€‌ adds our source. “But they completely lack insight on what happens on the ground.

â€‌ Instead, the regulator should hire “somebody who understands the spirit of the Petroleum and Natural Gas Regulatory Board Act.â€‌ Who could this be “I’d go for someone from the UK, one of the success stories in gas de-regulation, which effectively stopped BG and its affiliates like Centrica from continuing to be monopolies.