regulatory framework on oil & gas sector by b.s. negi member petroleum and natural gas...
TRANSCRIPT
REGULATORY FRAMEWORK ON OIL & GAS SECTOR
byB.S. NEGI Member
Petroleum and Natural Gas Regulatory Board, India
1
• Oil & Gas Sector Overview Up stream Infrastructure Regulatory regime Key Imperative and Suggestions Mid stream and Down stream Infrastructure Regulatory regime Issues
• Key Imperatives for India
2
• India’s Sedimentary Basins- 26
• Total Area- 3.14 million Square km.(msqkm)
• On land- 44%
• Shallow water- 14%
• Deep water- 42%
3
Area under License
Yet to License
Area (msk) (%)
2.15(68%)
0.99 (32%)
On land 46% 40%
Shallow water 14% 10%
Deep water 40% 50%
4
• Gas Resources- 400 tcf ( in 15 basins)
• CBM resources- 50 tcf (in 26 blocks)
• Total Natural Gas Resources- 450 tcf
• Gas resources Established From HC E&P- 114 tcf From CBM- 6 tcf Total Reserves- 120 tcf
5
6
Process of Award
Nos. of Blocks Remarks
Pre NELP 28 11, relinquished
Up to NELP-VI 206 Total awarded
NELP-VII 44 Awarded, Dec’08
NELP-VIII 100 On bid, expectedMarch, 2009
7
Accretion per Annum of Reserves
2014-15
2017-18
2020-21
2023-24
2026-27
1%*mmscmd
12* 76 145 191 214
2% 24 152 290 382 428
5% 58 378 728 956 1072
8
NELP - Fiscal benefitsNELP VII onwards no tax holiday for gas blocks, mineral oil definition limited to oilGas Hydrates – from limited participation of GAIL, OIL, ONGC, OIDB, NGRI – a more wider participation of interested parties with equity infusion as per the plan needs to be developed. Funds inflow could also be sought from international agenciesOpen acreage for exploration as a part of NELP where parties spend money for searching the reserves. Allocation policy of such blocks to be decided by the regulatorTechnical Standard – To follow the public consultation process
• Refining capacity – 148 MMTPA
• Pipeline infrastructureNatural Gas – 8000 km (including regional Network)Petroleum Product pipelines – 10000 kms
• CGD networks – 21 cities having gas supply, 10 Cities in Project stage 0.85 million house hold connected 0.60 million vehicle on CNG
Total infrastructure inadequate to meet the country’s requirements except oil
10
Regulatory Scenario
Petroleum & Natural Gas Regulatory Board Act
Policy for marketing of transport fuels
Policy on NG Pipelines and CGD networks
Product Pipeline Policy
Policy on Refining
Enforce retail & marketting service
obligation
Monitor prices & prevent restrictive
trade practices
Register & Authorise entities
Declare pipeline as common / contract
carrier
Perform other functions entrusted
by Central Government
Protect consumer interest by fostering
fair trade & competition
Regulate access & transportation rate
on common / contract carrier /
CGD network
Ensure adequate availability, and
equitable distribution
Functions of the Board
Lay down technical standards ,
specifications including safety
standards
Maintain databank of information
12
13
S No. Regulation Notified on
1 Levy of Fee and Other Charges 26-11-2007
2 Meetings of the Board 26-11-2007
3 Appointment of Consultants 30-11-2007
4 Conduct of Business, receiving and investigation of complaints
30-11-2007
5 Authorizing entities to Lay, Build, Operate or Expand City or Local Natural Gas Distribution networks
19-03-2008
6 Determination of Network Tariff for City or Local Natural Gas Distribution Network and Compression Charges for CNG
19-03-2008
7 Exclusivity for City or Local Natural Gas Distribution Networks
19-03-2008
14
S No.
Regulation Notified on
8 Authorizing entities to Lay, Build, Operate or Expand Natural Gas Pipelines
06-05-2008
9 Affiliate Code of Conduct for Entities Engaged in Marketing of Natural Gas and Laying, Building, Operating or Expanding Natural Gas Pipeline
17-07-2008
10 Access Code for Common Carrier or Contract Carrier Natural Gas Pipelines
17-07-2008
11 Technical Standards and Specifications including Safety Standards for City or Local Natural Gas Distribution Network
27-08-2008
13 Determination of Natural Gas Pipeline Tariff
20-11-2008
15
S No.
Regulation Notified on
1 Technical Standards and Specifications including Safety Standards for Natural Gas Pipelines
Public Consultation completed.
2 Emergency Response and Disaster Management
Public Consultation completed.
3 Declaring pipeline as Common Carrier or Contract Carrier
Public Consultation completed.
4 Procedure for Standards Development Public Consultation completed.
5 Authorizing entities to Lay, Build, Operate or Expand Petroleum Product Pipelines
Web hosted for public comments
16
S No.
Regulation Notified on
6 Methodology for determination of capacity for pipeline and CGD Networks
Under preparation
7 Access Code for Petroleum Product pipelines
Under Preparation
8 Quality of Service for CGD Networks Under Preparation
9 Determination of Tariff for Petroleum Product pipelines
Under Preparation
Infrastructure Development
Enviro
nmen
t
So
cial
Dev
elo
pm
ent
Enviro
nmen
t
Energy Security
En
erg
y E
ffic
ien
cy
Govt. Controlled
Liberalized
Mature
Nascent
OIL
GAS
MARKET
MARKET OPENING
Companies for Mkt Competition
1 2 3 4 5 6
HHI* 10000 10000 5000 3324 2500 2000 1653
Ensuring Energy security through
Extensive exploitation of sedimentary basins
CBM to have high priority
Underground coal gasification
National Gas Hydrates programme prioritization
Non Conventional energy resources
Infrastructure development for mid and down stream – NGG and
CGD
Infrastructure status for CGD networks apart from NGG
Priority allocation of gas for CGD networks
Cutting Edge Technologies and Innovation
Health, Safety and Environmental aspects
Regulations - Level playing field with predefined rules brings
competition conducive to
Private sector investment complimenting public sector
investment
Reduce vulnerability to prices and supply shocks
Bring in efficiency
Enhance infrastructure in energy sector transport
Emergence of retail gas user
Process of bringing competition is a single factor changing the
market scenario
HHI is the indicator of competition in the market