Gas regulator goes public in IGL row with oil ministry

Vol 12, PW 3 (26 Jun 08) People & Policy

When it comes to transparency, you can’t beat the office of the new Petroleum & Natural Gas Regulatory Board! This month the Board took the unprecedented step of going public with its bare knuckle fist fight with the oil ministry over whether Indraprastha Gas is â€کauthorised’ to carry out retail sales of CNG or piped gas to Delhi and its suburbs.

How By publishing two letters on its website (

in/) that lay bare the arguments from both sides, in black and white. The first is a letter dated May 15 from Manu Srivastava, a director in the oil ministry, arguing that IGL does not require authorisation from the Board.

The second is a letter from Ajay Tyagi, secretary to the Board, in which he delivers a stinging rebuke to Srivastava and the oil ministry, warning them to back off. At the heart of this row are two different interpretations of the Petroleum & Natural Gas Regulatory Board Act, 2006.

Seen in isolation, both are compelling arguments. Srivastava stresses the vaguely worded nature of the Act, which “does not prescribe any particular manner in which the government should have granted authorisationâ€‌ adding that, “it is amply clear IGL was authorised by the central government to implement CGD projects in Delhi and its suburbs.

â€‌ Srivastava ends: “In view of the above, IGL is free to undertake new or incremental activities to spread the CNG/PNG network to a greater number of customers in Delhi and its suburbs without need of a fresh authorisation from the Board.â€‌ Not so, counters Tyagi! In his response the outgoing Board secretary accuses the oil ministry of encouraging companies to break the law.

Tyagi believes the Act is clear, not vague. “If IGL has been authorised by the central government it should have provided the copy of an authorisation letter,â€‌ he writes.

“IGL was given enough opportunity to do so but they could not provide any copy of an authorisation letter.â€‌ Tyagi ends: “If the entity concerned (IGL) defies the decision of the Board it will have to face legal and other consequences under the Act.

â€‌ For IGL the question is simple: where is its authorisation letter

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