It is too early to give the Directorate General of Hydrocarbons (DGH) a role akin to a regulator, said Dharmendra Pradhan, Minister for Petroleum and Natural Gas.
According to the Minister, the upstream technical arm of the Ministry will have to wait as the hydrocarbons exploration sector in the country was still at a nascent stage. Pradhan was addressing the FICCI conference on ‘Unleashing India’s Domestic Exploration and Production Potential’.
“The upstream oil and gas sector is yet to develop in the country and there is scope for government initiated reforms. Establishing an independent regulator to emulate a market mechanism will not be appropriate,” he added.
Pradhan was responding to a suggestion that said that the DGH should be given powers similar to the Securities and Exchange Board of India (SEBI) to govern the upstream sector. He also said that the proposed Jagdishpur-Haldia and Bokaro-Dhamra gas pipeline will be extended to North East and will touch Guwahati. He said, “GAIL (India) Ltd has proposed extending the Urja Ganga pipeline to Guwahati.”
“Five oil public sector undertakings, including GAIL (India) Ltd, ONGC, Oil India, Bharat Petroleum Corp and Indian Oil Corporation have formed a Special Purpose Vehicle (SPV) to lay out the framework for a gas grid connecting the seven North-Eastern States,” he added.
He said that there is potential for natural gas production in Tripura, Manipur, Silchar valley and Arunachal Pradesh. “The company has done a feasibility study for extending the pipeline within the Rs. 12,940-crore pre-approved project cost,” he said.
Highlighting the government’s agenda to boost gas consumption, Pradhan said, “This month, the Petroleum and Natural Gas Regulatory Board will be announcing 100 new projects for City Gas Distribution networks. “The new bid parameters will take into account the experience of the earlier rounds for laying CGD networks. There will be provision of geographical flexibility too.”
Pradhan also said that GAIL will be setting up coal to gas conversion plants. He said, “GAIL India will be setting up coal to synthetic gas plants in Odisha. SAIL will be a technology partner in this project. This will be the first time that public sector undertakings will be developing such a project. This synthetic gas is expected to be cheaper than domestic gas and can meet the local requirements of the steel.”
“GAIL India is in talks with the Ministry of Fertilizer and Ministry of Coal for the same,” he added.