In a major blow to oil regulator PNGRB, the government has given Indraprastha Gas Ltd (IGL) the licence to retail CNG to vehicles and piped gas to households in Ghaziabad.
Petroleum and Natural Gas Regulatory Board (PNGRB), headed by L Mansingh, had previously ignored the government and the Supreme Court mandated committee's authorisation to IGL, which sells CNG and piped gas in Delhi, for city gas operations in neighbouring Ghaziabad.
PNGRB, last year, had put Ghaziabad on bidding and even after the Delhi High Court allowed IGL to "carry on their activities in Ghaziabad", it opened the bids to name Gujarat-based Adani Energy-led consortia as preferred bidder.
"IGL is an 'authorised entity' to lay, build, operate or expand city-gas distribution (CGD) network in Ghaziabad," the Oil Ministry said in an order on Tuesday.
The order said that the Delhi High Court has ruled that PNGRB has no powers to issue CGD licences and the power to do so vests in the ministry.
The Supreme Court-appointed Environment Pollution (Prevention and Control) Authority (EPCA) "had directed IGL to undertake CGD activities in Ghaziabad much before the commencement of PNGRB Act, 2006," it said.
EPCA has been given the powers of the Central Government under Environment Pollution (Prevention & Control) Act, 1986, in the National Capital Region (NCR).
"The Supreme Court has held that the directions of EPCA are final and binding on all persons and organisations concerned."
"Hence, EPCA's direction to IGL to undertake CGD activities in Ghaziabad would tantamount to a direction by the Central Government, even though Petroleum Ministry's earlier authorisation to IGL was limited to Delhi, NOIDA (Gautam Budhnagar), Gurgaon and Faridabad," the order said.
The PNGRB has so far refused to accept EPCA mandate to IGL and termed the company's activities in Ghaziabad illegal.
Mansingh did not take the phone calls made for comments.
Acting on EPCA direction, IGL had laid 331-km of steel pipelines, set up CNG stations, acquired land and already incurred substantial expenditure in Ghaziabad.
IGL is currently selling CNG from three stations in Ghaziabad and is on the verge of commissioning another eight while seven other CNG stations are under construction.
The company owned by state-owned GAIL India and Bharat Petroleum and Delhi Government, was authorised by the Central government to do city-gas work in Delhi.
On account of the geographical contiguity between East Delhi and Ghaziabad, IGL was implementing the CGD network in these areas as an integrated project with a common City Gate Station and steel trunk pipeline.