GAIL, BPCL, HPCL bid for city gas licenses raise eyebrows
GAIL, BPCL and 19 are competing for licenses in urban gas distribution sectors – nearly a third of the 61 being opposed in the latest bidding round – with companies they control facing allegations of unfair treatment. are.
For example, in the license area of Baloda Bazar, Gariaband and Raipur districts of Chhattisgarh, 16 bids have been received, out of which six are from companies-
Gas, BPCL, HPCL, Indraprastha Gas (IGL), Mahanagar Gas (MGL) and Avantika Gas – Sharing a complex web of relationships. GAIL GAS is a wholly owned subsidiary of GAIL (India). GAIL (India) is also the promoter of MGL. GAIL (India) and BPCL jointly control, while GAIL (India) and HPCL jointly control Avantika Gas. Similarly, out of 15 bids received for Nagpur, four are from GAIL Gas, Maharashtra Natural Gas (MNGL) and BPCL. MNGL is a joint venture of GAIL-BPCL.
BPCL is competing for licenses with its respective entities in 15 sectors, while GAIL Gas is competing in 11 and HPCL in three.
IGL and Central UP Gas, two BPCL-GAIL joint ventures, are competing for two city gas fields in UP. BPCL, GAIL, HPCL and Petroleum and Natural Gas Regulatory Board did not respond to ET’s request for comment. However, a source close to PNGRB said that all these firms were ultimately owned by the government and run by independent boards, leaving no scope for any unfair practices.
However, an executive of a large city gas firm rejected PNGRB’s defence, saying the auction process has been rigged, as there is a high chance of a group having more than one bid for the licence. “It is unfair to other bidders – public or private,” he said. Private players like Adani, Think Gas and Torrent Gas are among the big bidders in the current round.
An addendum to the tender issued by PNGRB on 18 November says: “If an entity forms more than one JV/consortium, for example, X forms the JV/consortium with Y (consortium C-1), and X forms another Forms JV/consortium. With Z (Union C-2), then Unions C-1 and C-2 are not allowed to bid for the same GA”.
A source close to PNGRB said the addendum does not apply to established joint ventures, but it has to be seen in the context of the new consortium formed to adhere to the net worth norms and avoid any manipulation.