EGoM approves guidelines for natural gas distribution

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New Delhi, Jun 25 (UNI) Empowered Group of Ministers (EGoM) in a meeting today approved guidelines for commercial utilisation of natural gas under New Exploration Licensing Policy (NELP).

According to the guidelines, contractors would sell gas from NELP to consumers in accordance with the marketing priorities and pricing formula determined by the Government.

The marketing priority does not entail any 'reservation' of gas. So, consumers belonging to any of the priority sectors should be in a position to actually consume gas as and when it becomes available.

If consumers in a particular sector, which is higher in priority, are not in a position to take gas when it becomes available, it would go to the sector which is next in order of priority, an official statement said.

In case of default by a consumer under a particular priority sector and further in the event of alternative consumers not being available in the same sector, the gas will be offered by contractor to other consumers in the next order of priority.

The guidelines also say that the priority for supply of gas from a particular source would be applicable only amongst those customers who are connected to existing and available pipeline network connected to the source.

The priority would not impact the process of price discovery whenever it is undertaken, as all the customers would participate in the price discovery process and would be eligible for utilising natural gas subject to priority.

Since the supply situation is expected to increase substantially in the near future in view of increased availability from domestic sources and imported gas (LNG/transnational pipelines), the guidelines would be applicable for the next five years after which they would be reviewed.

The EGoM has also issued guidelines for gas distribution by Reliance Industries.

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