The Ministry of Petroleum and Natural Gas plans to set up a regulator to look into health, safety and environment (HSE) practices in the oil and gas sector, minister M Veerappa Moily said on Thursday.
“I have moved a proposal to have a regulator for HSE and the ministry is looking into it,” Moily said on the sidelines of the two-day Global HSE Conference organised by Cairn India.
Currently, the Directorate General of Mines Safety is the regulatory body looking into safety in mines and oil fields. Moily said the proposed body would focus on the oil and gas sector.
Moily said the next round for the New Exploration Licensing Policy bidding would be early next year. “Taking lessons from the first nine rounds of auctioning, we would come up with a comprehensive policy this time. It would be industry-friendly,” he added.
On another matter, the minister said the deadline of the Kirit Parikh committee has been extended by a month. The panel was set up to look into a new methodology for pricing of diesel and liquefied petroleum gas, after ministries had a difference of opinion on pricing. “The report would be submitted after a month, as they have asked for an extension,” Moily said.
The finance and petroleum ministries had disagreed over the issue.
The finance ministry wanted a change in the formula and calculation to be made on the basis of export parity pricing, against import parity pricing now.
The new formula was expected to result in savings of Rs 15,000-18,000 crore a year, as it wouldn’t include costs such as transportation.
Calculating using import parity pricing involves 80 per cent of import parity price and 20 per cent of export parity price.
The new methodology was mooted by the finance ministry to reduce underrecoveries, as Customs duty of 2.5 per cent (according to import parity pricing) was going as underrecoveries.