GSPL gets relief on PNGRB refund order from Aptel

According to industry sources, GSPL reported transportation revenues of around Rs 3,570 cr during December 2008-June 2012

In a relief to Gujarat State Petronet Ltd (GSPL), the Appellate Tribunal for Electricity (Aptel) has granted an interim stay on the PNGRB's order directing GSPL to refund the excess cost charged by the company from the consumers with retrospective effect since November 2008.

GSPL had filed appeal against PNGRB order with the Aptel on January 28, challenging the gas regulator's, tariff order dated September 11, 2012. The tribunal, however, declined to stay Petroleum and Natural Gas Regulatory Board PNGRB's order to withdraw the separate recovery either in cash or in kind. The Aptel considered argument of PNGRB, which contended that the stay of the the issue 'would cause some serious consequences with respect to determination of tariff.'

The order is believed to bring relief to the state-run gas transmission player. "The quantum of amount payable by GSPL as a refund of excess cost of System Use Gas (SUG) and unaccounted gas is yet not clear. But it would be a significant amount that GSPL would have to pay immediately, thereby putting additional financial burden," said an oil & gas analyst with a broking house. According to industry sources, GSPL reported transportation revenues of around Rs 3,570 crore during December 2008-June 2012.

In its order, PNGRB cut the current average tariff for GSPL's high pressure pipelines by 12.5 per cent from Rs 27.41 (including SUG) per million metric British thermal unit (mmBtu) to Rs 23.99 per mmbtu with retrospective effect from November 20, 2008. This means that GSPL would have to refund Rs 3.42 per mmbtu to the shippers or consumers. GSPL had proposed the new tariff at Rs 39.6 per mmBtu.

PNGRB had maintained that GSPL was charging 'discriminatory' rate from different customers of its 2,239-km Gujarat gas grid. "..it was found that currently GSPL is charging discriminatory tariffs from different customers which range from Rs 2.54 per mmbtu to Rs 43.93 per mmbtu," PNGRB noted in its order. The company management could not be contacted for the comments on the order.

In its appeal before the Aptel, GSPL contested that both the directions violated PNGRB Act and applicable Rules. The company further argued that if a stay was not granted, "there would be huge economic loss to the Appellant (GSPL)."

The Aptel granted an interim stay on PNGRB's order directing GSPL to return the cost of the entire SUG to the shippers or consumers from November 20, 2008 onwards. The matter has been posted for final disposal on April 10.