Govt tables petro-regulatory board Bill

NEW DELHI: The government on Monday introduced a Bill in the Lok Sabha to set up a petroleum regulatory board that will regulate refining, marketing and transportation of petroleum products.

While the Board would have sweeping powers to check profiteering and ensure availability of products throughout the country, the government has retained powers to lay down broad policy framework from time to time, to intervene in "public interest" and to "issue directions" to the Regulator as and when it deems fit.

The Board would regulate the refining, processing, storage, transportation, distribution, marketing and sale of petroleum and petroleum products excluding production of crude oil and natural gas, Petroleum Minister Ram Naik said while introducing the Bill in Lok Sabha.

The Bill seeks to protect the interests of consumers and entities engaged in specified activities relating to petroleum and petroleum products, ensure uninterrupted and adequate supply of petroleum and petroleum products all over the country and promote competitive markets and related matters.

The petroleum regulatory board''s function would be to "protect consumer interest by fostering competition and fair trade, preventing profiteering by entities and ensuring adequate availability of petroleum product throughout the country by giving directions to companies".

It will authorise entitites to market petroleum products, lay down retail service obligations for retail outlets and marketing service obligations for entitites and monitor prices of petroleum products.

The Board, to have the same powers as are vested in a civil court, would decide on any dispute or matter amongst entities and consumer groups, levy fees and other charges and impose fine and penalties.

Any investor interested in undertaking an activity in petroleum sector would have to register with the Board, which will issue authorisation for marketing of petroleum products and building of common carrier pipelines.

The Board would monitor implementation of the plan for setting up dealerships and distributorships of petrol, diesel, kerosene and domestic cooking gas (LPG) by the entities without "encroaching on the retail networks of existing marketing companies."

The government will appoint the chairperson and four members to the Board, who will hold office for a term not exceeding five years or until they attain the age of 65 years, whichever is earlier.

With respect to pipelines and associated facilities for crude oil, petroleum products including natural gas, the board would regulate open access to pipelines declared as common carrier and regulate transportation tariffs. It would also authorise laying, building and expansion of pipelines and liquefied natural gas terminals.

Appeals against any decision or order of the Board could be filed in the High Court within 30 days from the date of communication of the decision of the Board.

From April 1, 2002, the government has decontrolled the marketing and pricing of all petroleum products except PDS (public distribution system) kerosene and LPG.

"One of the basic objectives of this Bill is to provide for a regulatory mechanism which would facilitate uninterrupted and adequate supply of petroleum and petroleum products in all parts of the country including remote areas at fair price, promote competitive markets and access to monopolistic infrastructure in the nature of common carrier on non-discriminatory basis by all entities," Naik said.

To prevent exploitation of consumers in the deregulated scenario, the regulatory board would ensure that each marketing entity announces the maximum retail prices for the notified petroleum and petroleum prodcuts, and take steps in accordance with regulations.

Provisions have been made in the Bill to ensure redressal of grievances and protection of consumer interest as also resolution of disputes amongst entities or between an entity and any other person.