News Release Details
Petroleum ministry against 'common carrier' pipelines
New Delhi 04-Aug-2007
The Petroleum ministry has expressed its strong opposition to declaring the existing oil and gas transportation pipelines as common carriers — much like public roads. The ministry is also opposed to the common carrier principle being extended to associated assets, including handling facilities at ports, terminals and airports. An integrated energy policy recommended by the Rangarajan committee had suggested allowing access to all competing suppliers to n on -dedicated transportation and distribution assets in the oil and gas sectors, including facilities at ports and airports, under the common carrier principle. The ministry has contended that these assets were created when the oil and natural gas sector was almost completely in the public sector domain. However, the ministry has agreed to expand the scope and include the associated storage and other facilities under the common principle on a prospective basis in future activities for both gas and product pipelines. Many policy makers contend that ideally these assets should be stripped off from current owners with due compensation and placed under a common carrier regime to promote competition. The Planning Commission, however, has suggested that a solution could be found by empowering the Petroleum and Natural Gas Regulatory Board to adjudicate the commercial terms under which such existing assets can be made available to competing users if so requested by a potential user of such assets. This will ensure that restrictive practices are not used to hinder competition, the commission has said.
New Delhi 04-Aug-2007
The Petroleum ministry has expressed its strong opposition to declaring the existing oil and gas transportation pipelines as common carriers — much like public roads. The ministry is also opposed to the common carrier principle being extended to associated assets, including handling facilities at ports, terminals and airports. An integrated energy policy recommended by the Rangarajan committee had suggested allowing access to all competing suppliers to n on -dedicated transportation and distribution assets in the oil and gas sectors, including facilities at ports and airports, under the common carrier principle. The ministry has contended that these assets were created when the oil and natural gas sector was almost completely in the public sector domain. However, the ministry has agreed to expand the scope and include the associated storage and other facilities under the common principle on a prospective basis in future activities for both gas and product pipelines. Many policy makers contend that ideally these assets should be stripped off from current owners with due compensation and placed under a common carrier regime to promote competition. The Planning Commission, however, has suggested that a solution could be found by empowering the Petroleum and Natural Gas Regulatory Board to adjudicate the commercial terms under which such existing assets can be made available to competing users if so requested by a potential user of such assets. This will ensure that restrictive practices are not used to hinder competition, the commission has said.