Shell, BP for splitting GAIL's gas transmission, marketing business

Amid talk of splitting state-owned gas utility GAIL India Ltd, global energy majors Royal Dutch Shell and BP plc have sought separation of natural gas marketing and transportation business before moving to a unified tariff for pipelines.

At an Open House called by the sector regulator Petroleum and Natural Gas Regulatory Board (PNGRB) on July 17 to discuss 'unified or pooling' method for computing gas transmission tariffs instead of current postal or distance based transportation rates, GAIL was pitched against formidable combination of Shell and BP on the issue of unbundling.

While Shell sought "legal unbundling of gas trading and transmission business, so that benefit goes to all shippers, BP felt unified tariff "should be done after unbundling of transmission and marketing functions of an entity," according to minutes of the meeting made available by PNGRB.

GAIL, on the other hand, said: "Unbundling is not related to the unification of tariff. Unification of tariff is a separate exercise and should be implemented on a standalone basis."