City gas regulator plans to open sector for competition

Consumers may soon have the power to choose between multiple operators of piped natural gas (PNG) and compressed natural gas (CNG) fuelling stations in different markets, where single operators have been operating so far without competition.

- Rituraj Baruah

Pointing to this possibility, Petroleum and Natural Gas Regulatory Board (PNGRB) chairman Anil Kumar Jain told Mint that the regulator would soon roll out new rules to allow for multiple natural gas operators to compete in various markets, especially those where infrastructure and marketing exclusivity for single companies is ending.

“However, it will be ensured that existing companies do not face any impact, such as new companies taking away attractive locations (with greater demand and footfalls), and that the new companies are ready to cater to remote and underserved areas," Jain said, adding that the market would be opened up through an open and fair process.

Infrastructure exclusivity refers to the exclusive right to not only use current pipelines and related infrastructure, but also the right to set up new infrastructure in the designated areas, while marketing exclusivity refers to the right to solely market and sell CNG and PNG in allocated areas. Exclusivity periods vary across licences. The maximum period for infrastructure exclusivity is 25 years and that for marketing eight years.