CGD network tender expected for 21 cities across India

Vol 12, PW 8 (04 Sep 08) People & Policy

Peace talks between the oil ministry and the Petroleum & Natural Gas Regulatory Board make it possible for real work to begin – on the ground.

PETROWATCH learns the Board will this week begin the bidding process for the award of licences to operate City Gas Distribution (CGD) networks across 21 cities. This follows scrutiny of the Expressions of Interest (EoI) received by the regulator at the end of June from Reliance and GAIL, which were open for public comments, suggestions and objections for a month.

“Press tenders will be issued this week,â€‌ confirms a Board source. “Bidders will have two months from the date of advertisement to send in bids.

â€‌ The Board will supervise the overall selection process and it will get help from state-owned engineering and design consultancy Projects & Development India. After scrutinising the EoIs and objections received, the Board divided cities into three categories for which bids will be invited: Category-I (7 cities) with existing trunk gas pipeline connectivity Category-II (10 cities) where such connectivity is likely by 2010 Category III (4 cities) likely to have pipeline connectivity after 2010 “The number of cities in Category III may go up when some company, for example, comes and says it will bring in coal bed methane from somewhere.

â€‌ We are assured of total transparency and impartiality in the selection process. “I like to tell people that human intervention will be minimum,â€‌ quips a senior Board source.

“The computer will decide the winner for each city.â€‌ There’s another category of cities for which EoIs were received but which already have either private or GAIL-promoted CGD networks.

“These are cities where we have objections from existing operators and they will be dealt with under Section 18.1 or Section 17.2 (of the Petroleum and Natural Gas Regulatory Board Act, 2006).â€‌ For instance, “if a particular operator has some CNG stations and a few kilometres of pipeline supplying PNG in such a city, we’ll clearly demarcate the geographical boundaries for that operator and throw open the rest of the city to bidding.

But our first priority is to begin the bidding process with no objections.â€‌