2 gas firms protest move to end their privileges
Ahmedabad: Two gas distribution companies, Sabarmati Gas Ltd (SGL) and Gujarat Gas Ltd
(GGL) are vehemently opposing the proposal of Petroleum and Natural Gas Regulatory Board’s
(PNGRB) to end their exclusive gas distribution rights over city gas distribution networks (CGD)
in Gujarat. This means that other players can also supply gas in these networks, and industry
players have welcomed the move.
Gujarat Gas Ltd supplies gas to Surat-Bharuch-Ankleshwar, and Sabarmati Gas Ltd supplies to
Gandhinagar-Mehsana-Sabarkantha CGD networks.
PNGRB has come up with a proposal to declare these CGD networks as common carrier or
contract carrier CGD networks. As many as 23 geographical areas across the country have been
identified, where the regulator proposes to terminate exclusivity period and throw them open
to new players.
The petroleum regulatory board has also invited comments/views of all the stakeholders before
taking a final call in this regard. Both Gujarat Gas and Sabarmati Gas have objected to the
proposal maintaining that PNGRB Act does not vest any power with the board to end exclusivity
period for CGD networks. The two companies have also requested the board to hear their side
before taking any final decision.
On the other hand, industry bodies have favoured the move aimed at ending exclusivity.
According to Jhagadia Industries Association, Gujarat Gas did not reduce price (of natural gas)
despite drop in natural gas prices worldwide. Many industries in Jhagadia industrial estate
purchase gas from Gujarat Gas. In view of the exclusivity, they are not able to purchase gas
from other suppliers.
“The move will help lower natural gas prices by creating a competitive environment. The
natural gas, a key fuel, has seen a steep rise in price over the past few years leaving the ceramic
industry in a position, where it cannot compete against imported goods from countries like
China. The end of exclusivity will help consumers avail benefit of cheap natural gas available
through SGL’s gas network,” Sabarkantha District Ceramic Manufacturers Association said in its
response to PNGRB’s proposal.