PNGRB seeks common carrier status for PSUs' ATF pipelines

The Petroleum and Natural Gas Regulatory Board (PNGRB) aims to declare major oil companies' jet fuel pipelines to key airports as common carriers. This move could allow private sector players to utilize these pipelines, potentially lowering transport costs and creating a more competitive jet fuel market.

New Delhi: The Petroleum and Natural Gas Regulatory Board ( PNGRB ) is seeking to declare state oil companies ' jet fuel (ATF) pipelines to some of the biggest airports in the country as common carriers in a bid to give private players equitable access and turn the jet fuel market more competitive.

PNGRB has sought to declare Indian Oil 's ATF pipelines to Delhi, Kolkata, Chennai and Lucknow airports and Bharat Petroleum 's pipeline to Kochi airport as common or contract carriers.

These pipelines mostly connect airports with refineries and are far more economical to use than alternative road transport.

A common carrier status will permit the use of these pipelines by private sector players such as Reliance Industries , bringing down their transport costs and making them more competitive in the ATF market.

Most major airports have open access fuel farm infrastructure or fuel supply mechanisms through browsers operated by various oil companies.

However, access to pipelines is crucial to keep ATF suppliers competitive.

"Without a common carrier or contract carrier pipeline, it becomes challenging to fully realise the benefits of an open fuel market because new and smaller fuel marketers cannot easily access the existing infrastructure," the PNGRB said, defending its move.

The regulator is seeking wider consultation on the subject.

"It is crucial that the existing pipelines, which have historically been controlled by a limited number of oil marketing companies, be designated as common carriers or contract carriers," it said.

"This designation would ensure that all marketers have equal opportunity to utilise these pipelines, fostering a more competitive and fair market environment.

" This would potentially lower prices and improve "service quality for end consumers, including airlines and, indirectly, passengers," the regulator said.

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