Due to lack of replacements for retiring members Petroleum and Natural Gas...

Due to lack of replacements for retiring members Petroleum and Natural Gas Regulatory Board becomes dysfunctional

Petroleum and Natural Gas Regulatory Board

Petroleum and Natural Gas Regulatory Board (PNGRB), the nation’s downstream regulator, is left with just one member due to the lack of replacements for the retiring members in the past one and a half years, making the board dysfunctional that can potentially delay the latest round of award of rights to build pipeline in eight districts.

Formed under an Act of 2006, the board appointed by the Central government comprises a chairperson, a member (legal) and three other members. In August 2015,Chairperson S Krishnan retired while in the past six months three other members—PK Bishnoi, Kiran Kumar Jha and Subhash Chandra Batra (member-legal) —have retired.  The only serving member in the board now is Basudev Mohanty.

According to the Act, the board gets to decide by a majority and its decisions don’t become invalid due to any vacancy. The board can’t meet and decide on anything because the quorum requires three members.

A source with direct knowledge of the regulator’s functioning said, “This has impaired the working of the board and created a regulatory vacuum.”

Last year, an advertisement for the position of PNGRB member was given by the government but there is no clarity on its outcome. The oil ministry didn’t respond to ET’s email query on what it was doing to deal with these vacancies, and if there was a plan to replace PNGRB by another regulator for the energy sector.

According to sources, for a long time, PNGRB has a few other vacancies as well, including those of key advisors, constraining its functioning.

Regulating the refining, transport and marketing of petroleum products, ensuring enough supply across the country, protecting consumer interest, fostering fair trade, and authorising companies that would build and operate fuel pipelines is the job of PNGRB.

The board has the power of a civil court and a bench comprising member (legal) and one or more members nominated by the chairperson decides on disputes arising among the downstream companies or with outsiders. This function of the board has practically been suspended due to the absence of members, said a source.

There has been a delayed decision on the award of rights in the eighth round to build and operate city gas networks in eight districts in Haryana, Goa, Puducherry, Uttar Pradesh and Maharashtra and this is another effect of the vacancies. Bids were invited by PNGRB in November and applications are being accepted until February 23, following which the bids are to be examined and successful bidders awarded.

According to another source many other routine activities such as consultations with stakeholders on various proposals are unaffected due to vacancies. The board is required only when a final decision has to be taken, he said.

News source: economictimes.indiatimes.com

Picture source: google.co.in