State-run GAIL India is considering legal options against Petroleum and Natural Gas Regulatory Board (PNGRB) on tariff model, given that revised tariff would impact the financials of the company. However, before undergoing a legal battle, the company will prefer to hold a dialogue with the regulator.
With the new tariff model, the company may end up losing about Rs 500 crore as the regulator has set a uniform tariff of Rs 5.56/mmBtu for GAIL’s 4-pipelines KG Basin Network, with retrospective effect (from November 20, 2008). GAIL has been charging Rs 11.44/mmBtu for Tatipaka-Kakinada-Kovuur network and Rs 28.38/mmBtu for Tatipaka-Kondapalli plus Lingala network. The company has argued that these tariffs were fixed before the PNGRB came into existence.
The company currently is studying the order, which is based on the assumption of gas supply of 16 mmscmd from KG Basin Network. However, the transmission company largely feels this order to unfair as its gets only 6 mmscmd of gas from the network.
