CNG retailers may get 'limited period' monopoly rights
The downstream oil regulator will decide on the period of exclusivity based on investment made, location and market growth.
By PTI |
NEW DELHI: The government is likely to allow companies have monopoly in retailing natural gas to households and CNG to automobiles for a 'limited period', which would be decided on the basis of investment made, location and market growth.
The Natural Gas Pipeline and City or Local Natural Gas Distribution Networks policy wants firms to commit long term investments based on reasonable return through network tariff, along with some incentive for earning profit from gas sales through a limited period of marketing exclusivity.
"The policy will be announced this month," a top official said adding that the exclusivity would be granted for transaction of volumes below a pre-determined threshold in a transparent manner.
The downstream oil regulator will decide on the period of exclusivity based on investment made, location and market growth, he said.
The new policy was in line with the demand made by state- run firms like GAIL and Indian Oil and multinationals such as British Gas (BG). It however runs contrary to suggestions made by the Mukesh Ambani-run Reliance Industries and the Anil Dhirubhai Ambani Group.
Industry sources said both RIL and ADAG plan to enter city gas distribution (CGD) business and are targetting cities which already have an entity retailing natural gas or where other big players too have evinced interest.
There was also a demand to declare the existing CGD network, including pipelines in Delhi and Mumbai, as common carrier so as to allow new entrants access them to retail gas.
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