Oil regulator approves Mukesh Ambani firm’s pipeline tariff

RGTIL, majority owned by Reliance Industries chairman and managing director Mukesh Ambani, has been allowed to charge five different tariffs along the pipeline route

Oil regulator Petroleum and Natural Gas Regulatory Board (PNGRB) has approved the tariff that billionaire Mukesh Ambani-owned East-West pipeline will charge for transporting gas from fields off the east coast to users, reports PTI.

PNGRB on 9th June approved the zonal tariff for Reliance Gas Transportation and Infrastructure Ltd's (RGTIL) 1,395-km pipeline from Gadimoga near Kakinada in Andhra Pradesh to Bharuch in Gujarat.

RGTIL, majority owned by Reliance Industries (RIL) chairman and managing director Mukesh Ambani, has been allowed to charge five different tariffs along the pipeline route. The 48-inch pipeline, the largest in Asia, has been divided into five zones of 300-km each, PNGRB said in its order.

The company will charge Rs15 per million metric British thermal unit (mmBtu) from customers like Anil Ambani Group's Samalkot power plant, which will get RIL's KG-D6 gas in zone-1 that is Andhra Pradesh.

For zone-2 and 3, the tariff has been fixed at Rs42 per mmBtu and Rs53.69 per mmBtu respectively, but there are very few customers on this stretch of the pipeline.

For zone-4, falling in Maharashtra, the tariff has been fixed at Rs58.75 per mmBtu and Rs60.94 per mmBtu is the tariff that customers in Gujarat will pay to RGTIL, the order said.

Most of the KG-D6 customers are in Maharashtra and Gujarat.

PNGRB said the tariff would be applicable from 1 April 2009 when the pipeline began shipping gas from KG-D6 to the customers.

"The difference between the zonal tariff already charged by the entities and that approved by the board shall be adjusted retrospectively with the customers for the relevant periods," the order stated.

PNGRB had, on 19th April, approved a provisional levelised (or average) tariff of Rs52.23 per mmBtu for the pipeline that can transport 80 million standard cubic meters per day of gas when all the 10 compressors are installed.

RGTIL, which charged Rs15 per mmBtu for transporting gas in zone-1 and Rs61.77 per mmBtu for states between Andhra Pradesh and Gujarat, had sought a levelised tariff of Rs53.64 per mmBtu.

PNGRB's order asking RGTIL to have five zonal tariffs would mean that it will charge different transportation fee for ferrying gas to users in Andhra Pradesh, Maharashtra and Gujarat.

In effect, users in Maharashtra, like the Dabhol Power, Plant will have to pay less than those in Gujarat. Currently, users in both states pay the same tariff.

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