Product Pipelines
HC allows Indian Oil to lay captive pipelines from KPL Jetty, Vellur terminal
This story was originally published at 13:26 IST on 16 August 2024
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NEW DELHI – The Delhi High Court allowed Indian Oil Corp to lay five captive pipelines from its KPL Jetty and Vellur Terminal in Tamil Nadu and rejected a December order by the Petroleum and Natural Gas Regulatory Board regarding the same. The board had asked Indian Oil Corp to stop laying the pipelines as the company had not taken authorisation from it for the same.
"This court is of the opinion that there is no authorisation required by IOCL (Indian Oil Corp) from PNGRB (Petroleum board) for laying down a pipeline for transporting its petroleum and petroleum products from its own jetty to the terminal," Justice Subramonium Prasad said. The court also rejected a petition by IMC Ltd which had contested Indian Oil Corp's move to lay the pipelines.
The case has its genesis in the Petroleum and Natural Gas Regulatory Board issuing an application for grant of authorisation for laying, building, operating or expanding a pipeline 21 km outside the boundary of Ennore Port to Manali Industrial Area. Both IMC and Indian Oil Corp had sought the board's authorisation to lay the pipelines. In 2015, the board granted authorisation to IMC for laying the pipelines.
However, in October last year, Indian Oil started laying down two multi-product petroleum and petroleum product pipelines of 10.5 km length from its KPL Jetty to Vellur Terminal. It also started laying three pipelines of 9 km length from Vellur Terminal to Manali Industrial Area.
In response, IMC said Indian Oil Corp should not have laid any pipeline without taking permission or authorisation from the petroleum board. It added that the concept of captive pipeline can't continue after enactment of the Petroleum and Natural Gas Regulatory Board Act, 2006.
The Petroleum and Natural Gas Regulatory Board supported IMC's contention. The petroleum and natural gas law and its regulations do not recognise the concept of a "captive pipeline" for transportation of petroleum and petroleum products, it said. However, the Centre said the framework of the Act and its regulations were for grant of authorisation and laying down common carriers or contract carriers, and apply only to those pipelines that impact consumers.
The court noted the contrasting views of the Centre and the petroleum board. "...the Union of India and the Board are singing different tunes, it is time for both of them to come together and take a decision which would be in the best interests of the country, keeping in mind the objectives for which the Board was formed, or suggest any amendments to the existing legislation or regulations framed thereunder," said the court.
At 1154 IST, shares of Indian Oil Corp Ltd traded 1.2% higher at 165.73 rupees on the National Stock Exchange.
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Reported by Surya Tripathi
Edited by Namrata Rao
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