Another eight cities for CGD auction

Vol 14, PW 2 (15 Jul 10) People & Policy

Labanyendu Mansingh is an ambitious man.

India’s gas and downstream regulator is gearing up to make a big impact as the government has granted him full powers over the retail gas and pipeline sectors with effect from July 15 (Thursday). On July 16 (Friday) the regulator will invite bids to set up retail gas networks in Asansol-Durgapur (West Bengal), Bhavnagar, Gandhidham-Anjar, Bhuj-Mundra, Jamnagar (all in Gujarat), Ludhiana, Jalandhar (both in Punjab) and Panipat (Haryana).

These towns are near GAIL’s HBJ, DVPL-2 and Essar Oil’s proposed CBM pipeline from Dhanbad to Kolkata and GAIL’s proposed Jagdishpur to Haldia pipeline. “In future,” Mansingh tells this report, “we will select only towns based on their proximity to ‘trunk’ (major) pipelines and the availability of gas supplies.

” Mansingh says ‘tap-off’ points from trunk pipelines to these and other towns offered in future will be clearly marked in tender documents. This is to prevent the three main Indian gas transportation companies GAIL, Reliance and Gujarat State Petronet from using unfair monopoly tactics and giving their competitors ‘tap-off’ points unreasonably distant from proposed city gate stations.

Mansingh tells PETROWATCH future gas license auctions will be managed differently from the two held earlier. Under consideration is a series of rapid-fire auctions held once every three to six months with approximately 50 towns offered to retail gas operators in each one.

If all goes to plan, the regulator could auction 300 towns in the next three years! Further, each 50-town ‘auction’ will be subdivided into six or seven smaller auction ‘rounds’ of five or six town clusters. Mansingh also wants to scrap the earlier tendency for “political correctness” by balancing competing regional interests across India.

“We used to pick one town in one part of India,” he says, “and balance that choice with another town in another region.” But bidders found this impractical, as different regions have different access to major gas transmission pipelines.

LNG Summit