Section 18 in The Petroleum and Natural Gas Regulatory Board (Authorizing Entities to Lay, Build, Operate or Expand City or Local Natural Gas Distribution Networks) Regulations, 2008
18. Entity not authorized by the Central Government for laying, building, operating or expanding CGD network before the appointed day.
(1)An entity laying, building, operating or expanding a CGD network at any time before the appointed day but not duly authorized to do so by the Central Government shall apply immediately for obtaining an authorization in the form as at Schedule I.(2)The Board may take into consideration the following criteria while considering the application for grant of authorization, namely:-(a)the entity meets the minimum eligibility criteria as [***] [Deleted 'at' by Notification No. G.S.R. 800(E), dated 19.11.2008 (w.e.f. 19.3.2008).] specified in clauses (a) to (e) and (i) of sub-regulation (6) of regulation 5 before the appointed date and is possessing all necessary statutory clearances, permissions, no objection certificates from the Central and State Governments and other statutory authorities;(b)an entity which is not registered under the Companies Act, 1956 at the time of submitting the application for grant of authorization shall undertake to become a company registered under the Companies Act, 1956:Provided that the Board may exempt an entity to register under the Companies Act, 1956 on such conditions as it may deem appropriate;(c)a satisfactory assessment of the actual physical progress made and the financial commitment thereof till immediately before the appointed day in comparison with the entity's DFR appraised by the financial institution funding the project. In case the project has not been funded by any financial institution, the Board may appraise the DFR. The DFR of the entity should clearly indicate the specified geographical area of the project and also specify the coverage proposed for CNG and PNG. In case upon scrutiny of the DFR by the Board by taking into account the geographical area, segments, infrastructure requirements, etc. proposed by the entity, the DFR is found to be sub-optimal and unacceptable, the Board may not consider the case of the entity for issuing the authorization;(d)in respect of the actual physical progress made and the financial commitment thereof referred to in clause (c), a physical progress of at least twenty five percent and a financial commitment of at least twenty five percent of the capital expenditure identified for the CGD project as per the DFR immediately before the appointed day may be considered as adequate;(e)the entity should have arranged, by way of acquisition or lease, land for CGS and procured the necessary equipment for erecting the CGS before the appointed day;(f)the Board reserves the right to get the actual physical progress and the financial commitment certified and depending upon the progress achieved, the Board may consider authorizing the entity for the authorized area-(i)as per the geographical area in its DFR;(ii)as per the geographical area actually covered under implementation till the appointed day; or(iii)the geographical area as specified by the Board;(g)in relation to laying, building, operating or expanding the CGD network, it is for the entity to satisfy the Board on the adequacy of its ability to meet the applicable technical standards, specifications and safety standards as specified in the relevant regulations for technical standards and specifications, including safety standards and the quality of service standards as specified in regulation 15;(h)assessment of the financial position of the entity in timely and adequately meeting the financial commitments in developing the CGD network project as appraised by a financial institution and an examination of the audited books of accounts of the entity;(i)firm arrangement for supply of natural gas to meet the demand in the authorized area to be covered by the CGD network;(j)any other criteria considered as relevant by the Board based on the examination of the application.(3)The evaluation of the application in terms of the clauses (a) to (j) shall be done in totality considering the composite nature and the inter-linkages of the criteria.(4)The Board, after examining the application in terms of the criteria under sub-regulation (2) and also taking into account the requirements in other regulations may form a prima-facie view as to whether the case should be considered for authorization.(5)In case of prima-facie consideration, the Board shall issue a public notice in one national and one vernacular daily newspaper (including webhosting) giving brief details of the project and seek comments and objections, if any, within thirty days from any person on the proposal.(6)The Board, after examining the comments and objections, if any under sub-regulation (5), may either consider or reject the case for grant of authorization for the CGD network.(7)In case it is decided to grant authorization, the same shall be in the form at Schedule(8)In case of rejection of the application the Board shall pass a speaking order after giving a reasonable opportunity to the concerned party to explain its case and proceed to select an appropriate entity for the project in terms of regulation 6.(9)In case the entity is selected for grant of authorization for CGD network,-(a)[ The transportation tariff shall be as determined by the Board as per regulation under section 22 of the Petroleum and Natural Gas Regulatory Board Act, 2006.] [Substituted by Notification No. F.No.PNGRB/CGD/Amendment/2015/2/SC, dated 26.4.2016 (w.e.f. 19.3.2008).](b)the Board may consider grant of exclusivity on such terms and conditions as specified in the Petroleum and Natural Gas Regulatory Board (Exclusivity for City or Local Natural Gas Distribution Networks) Regulations, 2008;(c)the entity shall abide by the technical standards, specifications including safety standards as specified under relevant regulations for technical standards and specifications, including safety standards;(d)the provisions under regulations 9, 13, 14, [***] [Omitted '15' by Notification No. F.No.PNGRB/Auth./CGD/Amd/2018, dated 6.4.2018 (w.e.f. 19.3.2008).] and 16 shall apply to the entity.
