The Supreme Court sought response from the Petroleum & Natural Gas Regulatory Board over a plea filed by GAIL against PNGRB’s decision to issue licence for Mehasana Bhatinda Natural Gas Pipeline project to Gujarat State Petronet for INR 5,000 crores.

A vacation Bench of Justice BS Chauhan and Justice Swatanter Kumar issued notice to the petroleum and gas sector regulator and directed it file its reply within two weeks. The Bench also gave one week time for GAIL to file its rejoinder.

The order of the Bench came in response to a plea filed by GAIL contending that the licence for authorisation for the project was issued to GSP for INR 5,000 crores by the Chairman’s nominee in violation of the Apex Court directions that all such decisions would be taken up only by a multi-member board.

However, with regard to the status of the MBPL project, the Bench made it clear that the issue of allotment of the project would be subjected to the outcome of its final order. The Bench said that “Issuance of letter of intent shall be subject to the final orders that may be passed.”

PNBRB had issued public notice inviting bidders for grant of authorization for laying, building, operating or expanding natural gas pipeline along route starting from Mehsana (Gujarat) to Bhatinda (Punjab) spanning 1670 kilometres. GAIL had also bid for the MBPL project which was later granted to GSPL.

GAIL has contended that the decision to give the project to GSP would cost the national exchequer a loss of around INR 5,000 crores. The Navratna company has claimed that it could deliver the same project at a cost of only ten percent of the amount claimed by GSP.

Earlier in an interim order, the Supreme Court had on May 12, directed PNGRB that all pending applications for grant of licences to retail CNG and piped gas line for homes would be taken up by a multi member board.

(Sourced from LAW ET AL)