The CGD Forum

The CGD Forum

The City Gas Distribution (CGD) Forum has evolved to address the critical need for a unified voice on common issues, especially those that are proving to be serious constrains against the growth of the CGD business and network expansion. It is for the first time that such a platform has been developed and coordinated by the CGD industry. Considering the country’s special requirements for widespread geographical penetration of natural gas usage, the Forum is one of the most important constituents of the Natural Gas Society (NGS), the emerging voice of the natural gas industry in India.

Today, some challenges have been overcome and there has been a visible growth in the CGD industry. From two cities, that is, Delhi and Mumbai, CGD operations have spread to around 45 geographic areas. Over 580 CNG fillings stations are servicing more than 1.2 million vehicles running on CNG. Around 15.22 lakh households, apart from commercial and industrials customers, are being serviced with PNG. There are 22 CGD companies operating in the country with total gas sales of 14 MMSCMD.

Even so, the CGD industry has faced several challenges that have constrained its rapid development. Almost the entire gamut of natural gas policy has undergone change since the first CGD system started. The declining availability of domestic natural gas, change in allocation policies, increasing imports of LNG, lack of control over gas pricing, regulatory issues, pipeline integrity and equipment safety concerns, multiple clearances, and at times standards based on existing legislation not precisely suited to the industry have impacted adversely on the economics of the business.

Towards a Consensus…

The CGD Forum, it is hoped, will serve to resolve many of these issues and bring industry players together on a common platform to encourage dialogue, interaction and collaboration as well as explore the possibility of creating a common ethical code for fair trade and intra-industry relationships, while boosting the overall growth of the industry. The Forum plans to establish expert groups to deliberate on issues faced by the industry to arrive 

at a consensus among industry players.

Road Travelled so Far…

The CGD Forum has held three meetings which have contributed significantly to realising the objectives of the Forum.

The first meeting was held on 14 March, 2013 in New Delhi. It was hosted by Mr. Prabhat Singh, Director (Marketing), GAIL (India) Limited, and attended by representatives of eight industry players apart from NGS and GAIL officials.

The wide-ranging industry-focussed discussions at the meeting led to the setting up of a working group led by CEO, Adani Gas with MD, Indraprastha Gas Limited (IGL) as the Co-Chair and CEO, GAIL Gas and MD, Mahanagar Gas Limited (MGL) to examine various aspects related to:

  1. Long-term Growth of the CGD Sector
  2. Safety (CNG Cylinder Issue)
  3. Skill Development

The second meeting of the CGD Forum, hosted by MGL, was held on 27 June, 2013 in Mumbai. Representatives of seven CGD market players debated pertinent issues and discussed the two discussion papers that had been circulated for review and comment among the CGD Forum members.

The first paper on the Safety of CNG Cylinders was developed by Adani Energy. During the presentation, issues pertaining to quality gas, verification of design and safety requirements for CNG cylinders and review of current legal and administrative framework were discussed.

A task force comprising representitives of IGL, MGL, Adani Energy and Sabarmati Gas was set up to finalise the recommendations and develop a consensus report. The second discussion paper on Skill Development was also discussed. A group comprising GM (JV), GAIL and GM, GAIL Gas Limited was set up to examine the suggestions presented on Skill Development modules and develop an Approach Paper for circulation so that it could be placed on the NGS portal for deliberations and feedback.

A presentation was also made by Sr. Vice President (Commercial), MGL, on the Sustainability of the CGD Sector and the necessity for curbing urban pollution specially from transport and industrial sectors in and around cities

 

The third meeting of the CGD Forum was held on 7 January 2014 at Ahmedabad and was hosted by Adani Energy. During the meeting, deliberations were held on the approach for developing a consensus on the issues of safety, taxation, levies and bidding document.

A meeting of the heads of CGD companies was hosted by NGS on 11 January 2014 at New Delhi. CEOs of GAIL Gas, IGL, MGL, MNGL and Adani Gas participated in the discussions. It was agreed that recommendations may be developed for the policy makers on this issue across the various points, specially where all CGD companies had been facing problems. During the meeting, a working group comprising representatives of Adani Gas, MGL, IGL, GAIL Gas and GSPC was formed to develop a basic paper for discussion on a bidding document. Another working group comprising representatives of Adani Gas, GAIL, MGL, GAIL Gas and GSPC was formed to develop a basic paper for discussion at the Governing Council on the PNGRB Act. During the meeting, it was also agreed to conduct a study on various taxes and levies for the CNG industry.

NGS was closely associated with the Asian Natural Gas Vehicles Association (ANGVA) 2013 organised in Delhi during November 2013 and the 8th Asia Gas Partnership Summit 2013 organised at Delhi during December 2013.

 

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