
Centre invokes Essential Commodities Act to prioritise natural gas allocation to certain sectors
The Hindu
India prioritizes natural gas allocation to key sectors amid disruptions from the Strait of Hormuz, invoking the Essential Commodities Act.
Invoking the Essential Commodities Act, 1955, the Ministry of Petroleum and Natural Gas (MoPNG) has sought diverting natural gas to certain priority sectors with a tiered structure.
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In a gazette notification dated March 9, the Ministry underlined domestic piped natural gas (PNG), Compressed Natural Gas (CNG) for vehicular fuel, and Liquified Petroleum Gas (LPG) production alongside fertilizer manufacturing, tea industries, manufacturing and other industrial consumers, among the priority sectors.
The gazette underlined the priority allocation was mandated in light of disruption of LNG shipments routed through the Strait of Hormuz, and Indian suppliers obligated to invoked forced majeure because of the ongoing tensions in West Asia. At present, about 30% of India’s natural gas requirements are routed through the Strait of Hormuz.
Earlier this week, the government had invoked the Essential Commodities Act for prioritising LPG supply to domestic consumers.
The gazette notification introduced tiered allocation priorities to each of these sectors. For example, domestic piped natural gas supply, CNG for transport and LPG production, among others, have been accorded for “priority allocation” with supplies to be upheld uninterrupted at “hundred per cent”, subject to operational availability. This would be premised on their average consumption from the previous six months.

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