Licence required for supply of gas: terms, conditions and contents of licence
Open ↗(1) No person shall supply gas through any pipeline unless such person is licensed under this Act.
(2) The Commission, with the approval of the Minister, may grant a licence for the supply of gas through pipelines on such conditions as may appear to be requisite or expedient having regard to the duties imposed by section 4 and on payment of such fee as may be prescribed by the regulations made under this Act.
(3) Any person applying for a licence shall submit to the Commission, whenever applicable, the following details:
(a) area of supply of gas;
(b) site location plan showing the proposed location of the premises to be installed with the gas pipeline and its neighbouring area;
(c) piping layout showing details of pipeline routes including the location of any storage tank or cylinder, site boundary, deflection wall and the nearest sources of ignition;
(d) technical specifications of the pipeline or installation;
(e) certification of the pipeline or installation; and
(f) any other information as may be required by the Commission.
(4) No licence shall be capable of being transferred, assigned, sub-licensed or otherwise disposed of unless the written consent of the Minister has been given.
(5) Licences may be for such periods as the Minister may in each case approve.
(6) Any licence granted under this section may extend to the determination of the area of supply by the Commission.
(7) Subject to the approval of the State Authority, any licence granted under this section may authorize the licensee to lay, place or carry on, under or over State land, to the extent and in the manner specified in the licence, such pipelines and installations and to erect and maintain in or upon State land such other equipment as may in the opinion of the Commission be necessary or proper for the purposes of the licence, and subject always to the approval of the State Authority, the said authorization may be given or added to at any time during the currency of the licence by endorsement thereon under the seal of the Commission.
Security, suspension or revocation of the licence
Open ↗(1) Before the issue of any licence the Commission may require a security, either in the form of cash or bank guarantee as the Commission may specify, to be furnished for the due observance of the terms and conditions of the licence. The amount of the said security shall be based on the licensee’s construction costs or operational costs or both, as the case may be, as determined by the Commission and such amount may be reviewed from time to time.
(2) A licence may at any time be suspended or revoked by the Commission upon breach of any of the conditions thereof or in default of payment of any moneys accrued due thereunder, or if the licensee ceases to construct or operate the pipeline or installation which he was authorized to do under the licence granted to him:
Provided that where a licence has been suspended or revoked under this subsection the licensee may, if he considers that he has suffered or may suffer undue hardship by reason of the suspension or revocation, appeal to the Minister against the suspension or revocation, as the case may be, and the decision of the Minister on the appeal shall be final.
(3) The licensee shall not be entitled to compensation for any loss of revenue caused to him by the suspension or revocation of a licence under this section.
(4) Upon the suspension of a licence, the Commission may—
(a) require the licensee to rectify any breach of any condition of the licence or to pay any moneys accrued due thereunder within a certain specified period; and/or
(b) in the interest of the public, authorize another person to continue operating the pipeline or installation if the pipeline or installation or part thereof has been in operation for the period of suspension.
(5) If the Commission is satisfied that the licensee has complied with the requirement under paragraph (4)(a) the suspension may be lifted and the licensee may be allowed to continue the construction or operation of the pipeline or installation, as the case may be. If the Commission is not satisfied, the Commission may revoke the licence.
(6) Upon revocation of a licence, the Commission may—
(a) require the licensee, within a reasonable period of time, to remove his pipeline or installation or part thereof at the licensee’s costs;
(b) acquire the pipeline and installation or part thereof on payment of adequate compensation to the licensee, and appoint another licensee to complete the construction of
the pipeline or installation or to supply gas through the acquired pipeline or installation, as the case may be; or
(c) authorize another licensee, on payment of adequate compensation, to acquire the pipeline or installation or part thereof and complete its construction or supply gas through the acquired pipeline or installation, as the case may be.
(7) If a licence is revoked under this section the security shall be forfeited as the Commission deems fit.
(8) In subsection (1)—
“operational costs” means all costs calculated by the Commission to be the costs of operating the supply of gas through any pipeline or installation including wages, costs of fuel, spare parts, labour charges and lubricants but not including capital costs or loans.
