Special Correspondent

NEW DELHI: In what is considered a move to give major impetus to expanding the network of piped natural gas (PNG) and compressed natural gas (CNG), the Petroleum and Natural Gas Regulatory Board (PNGRB) has received bids from various players for setting up PNG and CNG facilities across 61 cities.

Sensing the importance of this new mode of domestic and commercial fuel, that is both environmental friendly and cheap, the Union Ministry of Petroleum and Natural Gas has allocated five million standard cubic metres a day of gas exclusively for PNG networks and this quantity would go up as production picks up in the KG basin and new LNG contracts are signed.

According to PNGRB member Sudha Mahalingam, entities laying PNG networks will be selected through a competitive bidding process. Although the well-head price of gas is outside the direct regulatory purview, the regulator is ensuring that the cost of transporting gas to the consumer premises is kept at the minimum. “Therefore, lowness of network tariff will get 30 per cent weightage and lowness of CNG compression charge 10 per cent. Entity offering to connect the maximum number of domestic households will get a weightage of 30 per cent to ensure that the entity does not cherry pick the profitable consumer segments such as industrial and commercial establishments,” she remarked.

“PNG even when procured at the prevailing market rates is cheaper than subsidised PLG. Thus it is a win-win option for both consumers and oil marketing companies which can phase out LPG connections to consumers obtaining PNG connections,” she stated.