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regular-article-logo Wednesday, 17 April 2024

Oil regulator mulls jet fuel supply via pipelines in bid to boost competition, cut costs

The Petroleum and Natural Gas Regulatory Board has invited comments from the public and various stakeholders including oil companies, airport and airline operators for the development of aviation turbine fuel (ATF) pipelines connecting various airports in India

Our Special Correspondent New Delhi Published 27.02.24, 11:49 AM
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Oil regulator PNGRB has proposed supplying jet fuel or ATF in all existing and future airports through pipelines that can be accessed by any supplier to bring in competition and cut fuel costs.

Currently, ATF is transported by road and rail networks and only a limited number of airports are linked with pipelines.

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Even where pipelines are there, they are not on an open access basis, which means only the company that has laid it can supply jet fuel to airlines.

The Petroleum and Natural Gas Regulatory Board (PNGRB) has invited comments from the public and various stakeholders including oil marketing companies (OMCs), airport operators and airline operators for the development of aviation turbine fuel (ATF) pipelines connecting various greenfield and brownfield existing and upcoming airports in India.

"Pipelines are the cheapest mode of transport of liquid fuels with road transport being quite costly. And looking at the high share of ATF price in airline costs, provision of the pipeline could bring down the cost of air travel," the regulator said in a notice inviting comments.

While the fuel market is open in the airport premises, in the absence of a common carrier pipeline the objective of this open market cannot be achieved. There are a few other ATF pipelines which are being operated by the OMCs, which also need to be declared as common/contract carriers, the regulator said.

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