14. —(1) The following sections are substituted, on the appointed day, for section 10A (inserted by section 2(1) of the Act of 1995) of the Gas Act, 1976:

“10A.—(1) Subject to subsection (6) of this section, where an application is made to a pipeline operator by—

(a) the holder of a natural gas licence under section 16 of the Gas (Interim) (Regulation) Act, 2002, for the purpose of carrying out any activity for which the holder is licensed,

(b) the holder of a petroleum lease under section 13 of the Petroleum and Other Minerals Development Act, 1960, for the purpose of carrying out any activity connected with the lease,

(c) a person, including the Board, in respect of whom an order has been made under section 2(1) of the Gas (Amendment) Act, 1987, for the purpose of carrying out the functions conferred on the person by the order,

(d) a person who operates a gas-fired generating station, irrespective of its annual consumption level, for the purpose of providing energy for the generation of electricity at that station, or

(e) a final customer (within the meaning of section 2 of the Gas (Interim) (Regulation) Act, 2002), with an annual rate of consumption of not less than 2,000,000 standard cubic metres per annum (or such other rate as may stand prescribed for the time being) at a single meter installation for the purpose of delivery to that installation,

to transport on his or her behalf through pipelines under the control of the pipeline operator natural gas, the pipeline operator shall offer to enter into an agreement for the transportation of the natural gas on behalf of that person, subject to terms and conditions specified in regulations made by the Commission under subsection (3) of this section.

(2) Notwithstanding the generality of subsection (1) of this section, an offer made under that subsection:

(a) may include an offer to transport natural gas at a rate that is greater or less than the rate to which the request relates (but, except in the case of an application made by a person mentioned in subsection (1)(c) or (d), not less than the annual rate mentioned in subsection (1)(e) of this section), and

(b) where connection is required to the pipeline of the pipeline operator by the applicant—

(i) shall include the terms for such a connection, including any charges for connection, and details of all technical aspects relating to the connection that might be reasonably required by that person, and

(ii) on request of the applicant, may be on the basis that the applicant constructs, or that either or both the applicant and the pipeline operator arranges to have constructed, the connection to the pipeline, and the ownership of any such connection constructed or arranged to be constructed by the applicant shall, subject to subsection (8) of this section, be a matter for agreement between the parties.

(3) The Commission may by regulations provide for—

(a) the matters to be specified in an agreement for transportation of the natural gas through the pipeline of the pipeline operator, including terms and conditions relating to price;

(b) the matters to be specified in an agreement for connection to the pipeline of the pipeline operator;

(c) the terms and conditions, including terms and conditions relating to price of the connection, upon which an offer for connection to the pipeline of the pipeline operator is made;

(d) the methods for determining the proportion of the costs to be borne by the person making the application for connection to the pipeline of the pipeline operator and to be borne by the pipeline operator being costs which are directly or indirectly incurred in carrying out works under an agreement or making a connection or modifying an existing connection;

(e) the terms and conditions upon which applications for an agreement are to be made and the period of time within which an offer or refusal pursuant to an application is to be made by the pipeline operator; and

(f) any other matters which the Commission considers necessary or expedient for the purpose of making an offer for the transportation of natural gas through a pipeline or connection to a pipeline.

(4) A pipeline operator shall comply with any regulations made by the Commission under subsection (3) of this section within such time period as may be specified by the Commission in the regulations.

(5) A pipeline operator shall not make an offer under subsection (1) of this section other than to a person of the type mentioned in paragraph (a), (b), (c), (d) or (e) of that subsection.

(6) A pipeline operator may refuse a request made under subsection (1)—

(a) on the basis of a lack of capacity in its pipeline, save where it is economical for the operator to make the necessary enhancements to the capacity of the pipeline,

(b) on the basis of a lack of connection to that pipeline, save where the person making the request is willing to pay for such a connection in accordance with such conditions as may be specified by the Commission in regulations made under subsection (3) of this section,

(c) where, to enter into an agreement under this section would be likely to involve the pipeline operator in a contravention or a breach of—

(i) this Act, the Electricity Regulation Act, 1999, the Gas (Amendment) Act, 2000, or the Gas (Interim) (Regulation) Act, 2002;

(ii) regulations made under any of the aforesaid Acts;

(iii) the conditions of any licence granted or consent given to the pipeline operator under this Act or the Gas (Interim) (Regulation) Act, 2002;

(iv) the code of operations (within the meaning of section 13 of the Gas (Interim) (Regulation) Act, 2002) of the pipeline operator; or

(v) a public service obligation imposed on the pipeline operator by an order made under section 21(1) of the Gas (Interim) (Regulation) Act, 2002,

or

(d) the person making the application does not undertake to be bound by the terms of the aforesaid code of operations of the pipeline operator in so far as those terms are applicable to that person.

(7) Where a pipeline operator refuses to offer to enter into an agreement under this section, the operator shall serve notice on the applicant of the reasons for such a refusal.

(8) Any dispute between a pipeline operator and any person who is, or claims to be, a person to whom the operator is obliged to make an offer for the transportation of natural gas through or, where appropriate, connection to the pipeline of the pipeline operator (and whether as to the making of an offer, the terms offered, the proposed charges or otherwise) where an offer is made or refused by the operator, may, upon the application of that person, be determined by the Commission and the operator shall comply with and be bound by any such determination.

(9) Where an application is made under subsection (8) of this section to the Commission in relation to a dispute concerning a distribution or transmission pipeline, part of which is situated in the territory of another state, on the seabed under the territorial seas of another state or on the continental shelf belonging to another state, the Commission shall consult the relevant authorities in that other state with respect to the application.

(10) In order to ensure compliance with a determination made under this section the Commission may apply in a summary manner on notice to the High Court for an order requiring a pipeline operator to comply with the determination.

(11) Where providing for the transportation of natural gas or where offering terms for the carrying out of works for the purpose of connection to the pipeline of a pipeline operator, the pipeline operator shall not discriminate unfairly as between any persons or classes of persons.

(12) A pipeline operator shall not, in the context of sales or purchases of natural gas by that operator or related undertakings, abuse commercially sensitive information obtained from third parties in the context of providing or negotiating access to a pipeline under the control of the pipeline operator.

(13) In this section ‘pipeline operator’ has the same meaning as in section 14 of the Gas (Interim) (Regulation) Act, 2002.

10B.—(1) Subject to subsection (6) of this section, where an application is made to an upstream pipeline operator by—

(a) the holder of a natural gas licence under section 16 of the Gas (Interim) (Regulation) Act, 2002, for the purpose of carrying out any activity for which the holder is licensed,

(b) the holder of a petroleum lease under section 13 of the Petroleum and Other Minerals Development Act, 1960, for the purpose of carrying out any activity connected with the lease,

(c) a person, including the Board, in respect of whom an order has been made under section 2(1) of the Gas (Amendment) Act, 1987, for the purpose of carrying out the functions conferred on the person by the order,

(d) a person who operates a gas-fired generating station, irrespective of its annual consumption level, for the purpose of providing energy for the generation of electricity at that station, or

(e) a final customer (within the meaning of section 2 of the Gas (Interim) (Regulation) Act, 2002) with an annual rate of consumption of not less than 2,000,000 standard cubic metres per annum (or such other rate as may stand prescribed for the time being) at a single meter installation for the purpose of delivery to that installation,

to transport on his or her behalf through pipelines under the control of the upstream pipeline operator natural gas, the upstream pipeline operator shall offer to enter into an agreement for the transportation of the natural gas on behalf of that person, subject to terms and conditions specified in regulations made by the Minister for the Marine and Natural Resources under subsection (3) of this section.

(2) Notwithstanding the generality of subsection (1) of this section, an offer made under that subsection:

(a) may include an offer to transport natural gas at a rate that is greater or less than the rate to which the request relates (but, except in the case of an application made by a person mentioned in subsection (1)(c) or (d), not less than the annual rate mentioned in subsection (1)(e) of this section), and

(b) where connection is required to the pipeline of the upstream pipeline operator by the applicant—

(i) shall include the terms for such a connection, including any charges for connection, and details of all technical aspects relating to the connection that might be reasonably required by that person, and

(ii) on request of the applicant, may be on the basis that the applicant constructs, or that either or both the applicant and the upstream pipeline operator arranges to have constructed, the connection to the pipeline, and the ownership of any such connection constructed or arranged to be constructed by the applicant shall, subject to subsection (8) of this section, be a matter for agreement between the parties.

(3) The Minister for the Marine and Natural Resources may, following consultation with the Commission, by regulations provide for—

(a) the matters to be specified in an agreement for transportation of the natural gas through the pipeline of the upstream pipeline operator, including terms and conditions relating to price,

(b) the matters to be specified in an agreement for connection to the pipeline of the pipeline operator,

(c) the terms and conditions, including terms and conditions relating to price of the connection, upon which an offer for connection to the pipeline of the pipeline operator is made,

(d) the methods for determining the proportion of the costs to be borne by the person making the application for connection to the pipeline of the pipeline operator and to be borne by the pipeline operator being costs which are directly or indirectly incurred in carrying out works under an agreement or making a connection or modifying an existing connection,

(e) the terms and conditions upon which applications for an agreement are to be made and the period of time within which an offer or refusal pursuant to an application is to be made by the upstream pipeline operator, and

(f) any other matters which the Minister for the Marine and Natural Resources considers necessary or expedient for the purpose of making an offer for the transportation of natural gas through a pipeline or connection to a pipeline.

(4) An upstream pipeline operator shall comply with any regulations made by the Minister for the Marine and Natural Resources under subsection (3) of this section within such time period as may be specified by the Minister for the Marine and Natural Resources in the regulations.

(5) An upstream pipeline operator shall not make an offer under subsection (1) of this section other than to a person of the type mentioned in paragraph (a), (b), (c), (d) or (e) of that subsection.

(6) An upstream pipeline operator may refuse a request made under subsection (1) of this section—

(a) on the basis of a lack of capacity in its pipeline, save where it is economical for the operator to make the necessary enhancements to the capacity of the pipeline,

(b) on the basis of a lack of connection to that pipeline, save where the person making the request is willing to pay for such a connection in accordance with such conditions as may be specified by the Minister for the Marine and Natural Resources in regulations made under subsection (3) of this section,

(c) where, to enter into an agreement under this section would be likely to involve the upstream pipeline operator in a contravention or a breach of—

(i) the Gas Acts, 1976 to 2002, the Electricity Regulation Act, 1999, the Gas (Amendment) Act, 2000, or the Gas (Interim) (Regulation) Act, 2002,

(ii) regulations made under any of the aforesaid Acts,

(iii) the conditions of any licence granted or consent given to the upstream pipeline operator under this Act or under the Gas (Interim) (Regulation) Act, 2002,

(iv) the conditions of any licence, lease or permit granted to the upstream pipeline operator under the Petroleum and Other Minerals Development Act, 1960, or

(v) the upstream pipeline operator's code of operations, being a code, approved by the Minister for the Marine and Natural Resources, in respect of all technical design, operational and other requirements relating to operation of the upstream pipeline in respect of which the holder has been granted a consent by that Minister under section 40(1),

or

(d) the person making the application does not undertake to be bound by the terms of the aforesaid code of operations of the upstream pipeline operator in so far as those terms are applicable to that person.

(7) Where an upstream pipeline operator refuses to offer to enter into an agreement under this section, the operator shall serve notice on the applicant of the reasons for such a refusal.

(8) The Minister for the Marine and Natural Resources, or any person nominated in that behalf by the Minister, for the purposes of Article 21 of the Directive, shall be the competent authority (in this section referred to as the ‘competent authority’) in the State to settle expeditiously disputes concerning refusal of access to upstream pipelines within the scope of the Directive.

(9) Any dispute between an upstream pipeline operator and any person who is, or claims to be, a person to whom the operator is obliged to make an offer for the transportation of natural gas through a pipeline under the control of that operator (and whether as to the making of an offer, the terms offered, the proposed charges or otherwise) where an offer is made or is refused by the operator, may, upon the application of that person, be determined by the competent authority and the operator shall comply with and be bound by any such determination.

(10) Where an application is made under subsection (9) of this section to the competent authority in relation to a dispute concerning an upstream pipeline, part of which is situated in the territory of another state, on the seabed under the territorial seas of another state or on the continental shelf belonging to another state the competent authority shall, prior to considering the application, consult the relevant authorities in that other state with respect to the application.

(11) The parties to a dispute referred to in subsection (8) of this section shall provide all documents, records, accounts, estimates and other information, whether oral or written, requested from time to time, by the competent authority in the form and at the times specified by that authority, for the purpose of making a determination under subsection (9) of this section.

(12) (a)   In making a determination under subsection (9) of this section, the competent authority shall apply the objectives of—

(i) fair and open access,

(ii) achieving a competitive market in natural gas, and

(iii) avoiding any abuse of a dominant position.

(b)   In applying the objectives under paragraph (a) of this subsection, the competent authority shall take account of—

(i) security and regularity of supplies,

(ii) capacity which is or can reasonably be made available,

(iii) environmental protection, and

(iv) the number of parties which may be involved in negotiating access to upstream pipelines.

(13) Without prejudice to the generality of subsection (12) of this section, in making a determination under subsection (9) of this section, the competent authority may take into account the need—

(a) to refuse access where there is an incompatibility which cannot be reasonably overcome between the technical specifications being proposed by the applicant and those applying to the pipeline of the upstream pipeline operator,

(b) to avoid difficulties which cannot be reasonably overcome and could prejudice the efficient, current and planned future production of natural gas or other hydrocarbons, including that from fields of marginal economic value, and

(c) to respect the duly substantiated reasonable needs of the upstream pipeline operator for the transport and processing of gas and the interests of all other users of the relevant upstream pipeline or processing or handling facilities who may be affected.

(14) In order to ensure compliance with a determination made under subsection (9) of this section the competent authority may apply in a summary manner on notice to the High Court for an order requiring an upstream pipeline operator to comply with the determination.

(15) Where providing for the transportation of natural gas or where offering terms for the carrying out of works for the purpose of connection to a pipeline under the control of an upstream pipeline operator, the upstream pipeline operator shall not discriminate unfairly as between any persons or classes of persons.

(16) An upstream pipeline operator shall not, in the context of sales or purchases of natural gas by that operator or related undertakings, abuse commercially sensitive information obtained from third parties in the context of providing or negotiating access to a pipeline under the control of the upstream pipeline operator.

(17) (a)   Subject to paragraph (b) of this subsection, an upstream pipeline operator shall, within such time as the Minister for the Marine and Natural Resources may direct, prepare a statement for the approval of the Minister setting out the basis upon which charges are imposed—

(i) for the transportation of natural gas through a pipeline under the control of the upstream pipeline operator, and

(ii) for connection to a pipeline under the control of that upstream pipeline operator.

(b) The Minister for the Marine and Natural Resources may—

(i) give directions to an upstream pipeline operator from time to time in respect of the basis for charges for the transportation of natural gas through, or connection to, a pipeline under the control of the upstream pipeline operator, and

(ii) specify by regulations the classes of upstream pipeline operator to whom paragraph (a) of this subsection does not apply.

(c)   Notwithstanding the generality of paragraph (b) of this subsection, directions given by the Minister for the Marine and Natural Resources under this subsection may provide for—

(i) the methods of charging to be included in the statement to be prepared by an upstream pipeline operator,

(ii) the form and the extent of the information to be provided by an upstream pipeline operator to applicants,

(iii) the form of charges and information about those charges to be included in the statement to be prepared by an upstream pipeline operator,

(iv) the procedure to be adopted in the submission by an upstream pipeline operator of a statement of charges and the approval by the Minister for the Marine and Natural Resources of such statement, and

(v) the nature of information to be provided to applicants seeking the transportation of natural gas through, or connection to, a pipeline under the control of the upstream pipeline operator and its presentation and transparency.

(d)   An upstream pipeline operator shall comply with directions given to it by the Minister for the Marine and Natural Resources under this subsection.

(e)   A charge for the transportation of natural gas through, or connection to, a pipeline under the control of the upstream pipeline operator shall be calculated in accordance with directions given by the Minister for the Marine and Natural Resources under this section so as to enable the upstream pipeline operator to recover—

(i) the appropriate proportion of the costs directly or indirectly incurred in carrying out any necessary works, and

(ii) a reasonable rate of return on the capital represented by such costs.

(f)   The Minister for the Marine and Natural Resources, solely, shall determine that which constitutes an ‘appropriate proportion’ referred to in paragraph (e)(i) of this subsection and a ‘reasonable rate of return’ referred to in paragraph (e)(ii) of this subsection.

(18) (a)   An upstream pipeline operator shall send each statement prepared in accordance with subsection (17) of this section to the Minister for the Marine and Natural Resources for its approval (in this section referred to as the ‘statement’) and the statement, and in particular any charges referred to therein, shall not apply until such time as it has been approved of by the Minister for the Marine and Natural Resources, subject to such modifications, if any, as that Minister considers appropriate.

(b)   The Minister for the Marine and Natural Resources shall consult with an upstream pipeline operator and have regard to any submission made by the upstream pipeline operator to the Minister for the Marine and Natural Resources prior to making a decision as to whether to approve of or not, as the case may be, a statement submitted by the upstream pipeline operator to the Minister for the Marine and Natural Resources for approval.

(c)   Any charges imposed by an upstream pipeline operator on or before the coming into operation of this section shall, subject to the approval of the Minister for the Marine and Natural Resources, continue in force until a statement has been approved of by that Minister under this section and thereafter all charges shall be in accordance with a statement approved of by that Minister.

(19) In this section—

‘Directive’ means Directive 98/30/EC of the European Parliament and of the Council of 22 June 1998 concerning the internal market in natural gas;

‘pipeline’ means an upstream pipeline and includes facilities supplying technical services incidental to acquiring access to such pipelines;

‘upstream pipeline operator’ means a person operating an upstream pipeline in accordance with a consent given by the Minister for the Marine and Natural Resources under section 40 (1).”.

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