Policy
India Keen On Establishing A Gas Trading Hub
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Draft Policy For EOR Projects Noble But Challenges Likely
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ONGC In Desperate Hurry To Acquire Producing Assets
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Battle For Reduction In Cess On Crude Oil Begins
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OVL To Be Strengthened For Enhanced Role In Asset Acquisitions
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Regulation
India To Launch Bidding Round Under OAL On January 16
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Projected Domestic Gas Availability May Derail LNG Terminals
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FSRUs Face Uncertainty, Move At Slow Pace In India
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Pet Coke Unlikely To Disappear From India In Near Future
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Alternative Energy / Fuel
NITI Aayog Proposes 15,000 Ton Coal–To-Methanol Unit
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New Projects
L&T Wins A Major ONGC Contract
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McDermott International Awarded Contract In KG Basin By RIL
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RIL Completes $16-Billion Expansion, Doubles Ethylene Capacity
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Six Cos Evince Interest For Storing Crude In Pudur Oil Reserve
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Market Watch
India Challenges China As World’s Biggest LPG Importer
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IGL Smart Card Program
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ONGC Petro Seeks Dealers
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Apar Industries Enters A JV To Market Auto Lubricants
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Companies
Indraprastha Gas Limited
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L&T Hydrocarbon Gets Rs 21 Billion Projects From RIL, HPCL
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OIL Makes 2 Hydrocarbon Discoveries
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GAIL Commissions India’s Second Largest Rooftop Solar Plant
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Essar Oilfields Bags Contracts From Mercator Petroleum
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Cairn India Acquires Controlling Stake In Avanstrate For US$158 Million
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Press Release [FREE Access]
Petro Intelligence » Regulatory Board In Its Death Throes

By R. Sasankan

“Ah Love! could thou and I with Fate conspire
To grasp this sorry Scheme of Things entire,
Would not we shatter it to bits -- and then
Re-mould it nearer to the Heart's Desire!”
– Omar Khayyam, Persian poet

Narendra ModiKarl Marx visualised a stage where the state would simply wither away. This was the ultimate phase of his ideal socialist state. But there is a massive gap between precept and practice – and the so-called practitioners of his creed have proved Marx wrong.

Instead of the state withering or weakening its hold, they have become Leviathans – not much different from Thomas Hobbes’ social contract theory which posited the idea that civil war could only be avoided by an absolute sovereign ruling a Commonwealth that he termed the Leviathan in his book that bore the same title. Institutions that were once perceived to be useful to society have been either undermined or dismantled, especially in countries like Russia and China which experimented with Communism.

Regulatory bodies underpin the rule of law in most countries. All industrialised economies, except Russia and China, have institutionalised regulatory bodies. India started the process of setting up regulatory bodies about two decades ago but went about creating them in the wrong way. The government ensured that these regulatory bodies did not become so powerful that their writ would undermine the powers of the bureaucracy and the politicians. Thus, regulatory bodies became a parking lot for superannuated bureaucrDharmendra Pradhanats. This coupled with the traditional knack of picking up the wrong people for responsible jobs prevented these regulatory bodies from having the desired impact.

The cash-rich petroleum sector has been doing reasonably well notwithstanding the interference of the political party in power. The petroleum sector was almost totally dominated by the public sector companies since the days of Mrs Indira Gandhi but, with the entry of companies such as Reliance and Essar in the downstream sector and foreign companies in the E&P, the government came under pressure to set up regulators. The bureaucracy blocked it for the upstream sector by manipulating the creation of a technical body called the Directorate General of Hydrocarbons (DGH) which royally messed things up. DGH, which is part of the Ministry of PetrolL Mansingheum and Natural Gas, only has an advisory role. But even in that limited role, it has managed to play havoc in the E&P sector.

The government looked sincere in setting up a regulator for the downstream sector when it enacted an Act to create a Petroleum and Natural Gas Regulatory Board (PNGRB). But it again bungled while drafting the provisions of the Act and selecting the team. The PNGRB is now in its death throes. In the absence of a miracle, its funeral can be expected very shortly.

None has criticised the Modi government for the present state of the PNGRB and rightly so. The PNGRB never played a useful role in its decade-long existence. Almost all its decisions that were challenged in courts of law have been struck down. In desperation, the Board had advertised for consultants to redraft the regulations but it is not in a position to award the job to anyone.

Surprisingly, the Board which lacks a quorum has protested against the government move to permit GAIL to set up CNG units along the Jagdishpur-Haldia gas pipeline route. There is merit in its protest becaV.K. Sibaluse under the PNGRB Act, it is the only one empowered to authorise gas pipelines and CGD units. Even those CGD units and pipelines created before PNGRB was established were duty bound to seek regularisation from PNGRB.

The Modi government has not commented on the state of affairs in PNGRB. Not has it reacted to the regulator’s protest against the blanket permission given to GAIL to set up CGD units. The PNGRB has been without a chairman for the last two years. Of its total strength of five members, it is has only one now. The government probably believes that the country can do without a downstream regulator, a perception shared by many within the industry. The government’s silence has frustrated the ambitions of quite a few superannuated bureaucrats who have been lobbying for the post of chairman.

B. MohantyBut the question is why the government is allowing the space occupied by PNGRB to be wasted. All its employees are on deputation from PSUs and they will have no problem in going back. The government can save on rent for the space it now occupies by shifting the only surviving member to a room elsewhere. He is a genuine expert in petroleum matters and his talents can be utilised during the remaining period of his tenure elsewhere.

The government will certainly come under pressure to create an effective regulator if its plan to set up a mega oil behemoth by merging all the oil and gas companies becomes a reality. On present reckoning, this cannot happen in the next two or three years. As and when it happens, the PNGRB Act itself will have to be changed drastically to create an effective regulatory body. Perhaps, the Modi government is waiting for such an opportunity to recast and remould PNGRB. The strategy is not to create sound and fury by smashing it to bits but to allow its slow death so that a powerful regulator can be created later. In Modi’s scheme, the regulator ought not to be reduced to a weak body of retired bandicoots.



To download the latest issue 'Volume 24 Issue 19 - January 10, 2018', click here
Petro Intelligence [FREE Access]
Putin’s Great Game: A Gas Pipeline To India
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ONGC: More Sinned Against….
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PLL: Making Up For Old Lapses
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Bombay High’s Tale Of Woe: Short Shrift For Local Talent
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Foreign Investment
Debt-Ridden Aban Offshore Seeks Settlement With Lenders
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Overseas Investment
India To Help Mongolia Set Up Refinery
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Gas Scene
Sector-wise Consumption of Natural Gas in November 2017
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List Of Importers & Source-Wise LNG Imports In November 2017
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Gas pipelines under execution / construction as on 1st November, 2017
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Domestic Natural Gas Scene : November 2017
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Capacity Utilisation of Gas Pipeline Network as on 1st October, 2017
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Status of Coal Bed Methane Gas development in India (Sept 2017)
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Status of Shale Gas and oil development in India
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Sectoral Consumption of gas in October 2017, far below demand projections
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LNG Imports and Domestic Gross Natural Gas Production In October 2017
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Update: CNG Stations & Vehicles and CNG Sales
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Update: CGD Factsheet as of September 2017
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Natural Gas Share in Prime Energy Mix
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Domestic Gas Price (November 2014 -March 2015 to October 2017 - March 2018)
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Source-Wise LNG Imports In September 2017
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Sector-wise gas consumption of domestic gas and RLNG (July 2017)
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ONGC Asset-wise gas flaring in FY 2016-17
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Data Section
Monthly Upstream Data
Monthly Downstream Data
Historical database
Data Archives
Special Database
Total reserves of ONGC group as on April 1, 2017
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End-Use Sectors of High Speed Diesel
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IOC’s Unparalleled Cross -Country Pipeline Network, Market Share, Throughput and Capacity Utilisation
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Petroleum products demand & Gross Domestic Product (GDP) during five year period
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Retail Selling Prices of Petrol and Diesel: India vis-a-vis Developed Countries
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Status of blocks under NELP (2017-18)
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Petroleum Sector’s Contributions To States Through Taxes
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Revenue from the Petroleum Sector and Payout from Government for petroleum subsidy
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Important terms in pricing of petroleum products
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India’s Region-Wise Crude Imports in November 2017
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Retail Selling Price (RSP) of major products in India & neighbouring countries
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Power deficit: Region-wise position for November, 2017
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High Sulphur Crude Processing Hits An All Time High
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Oil India Ltd Cost Structure
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Specific energy consumption (MBN number) of PSU refineries
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Uptrend Stalled In Distillate Yield Of PSU Refineries
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Oil India Ltd : Large and Diversified Domestic Reserve Base
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ONGC: VAP Production
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ONGC Intensifies Exploration In Kutch-Saurashtra
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High Sulphur (HS) & Low Sulphur (LS) crude oil processing
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Latest Estimated Hydrocarbon Reserves In India
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An Updated LPG Profile In Brief ( April- September 2017)
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Import of Crude oil and Petroleum Products (April – October 2017)
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Tenders [FREE Access]
IndianOil
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IndianOil
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IndianOil
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Oil and Natural Gas Corporation Limited
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