New safety rules: Industry and petroleum ministries in tug-of-war

Petroleum ministry alleges it was bypassed in formulation of new regulations.

ISLAMABAD:

The Ministry of Petroleum has alleged that the Department of Explosives which comes under the purview of the Ministry of Industries has not taken it on board while formulating its mineral and industrial gases safety rules. The new framework gives wide discretionary powers to the Chief Inspector of Explosives (CIE) and has sparked controversy between the two ministries and panic in the local industry. A senior official of the Ministry of Petroleum told The Express Tribune that the issue had also been taken up with the Prime Minister.

“The Ministry of Industries’ Department of Explosives has framed rules; namely the mineral and industrial gases safety rules; without consulting the Ministry of Petroleum and Natural Resources,” the official said; adding that under the rules of business, inter-ministerial consultation – overlooked in this case – was mandatory before the framing of such rules.

The official said that the prime minister had been informed that the rules framed by the Department of Explosives empowered the CIE to additionally undertake the functions of testing, inspecting and monitoring of petroleum, CNG and LPG operations – which lie under the petroleum ministry’s domain.

The petroleum ministry said that it had noted that accidents in cylinder-fitted vehicles in public service were increasing at an alarming rate. It complained that factors responsible for such incidents included, among others, the overlapping functions of related federal agencies like the Oil and Gas Regulatory Authority (Ogra) and the Department of Explosives.

“It has been noted that if one regulator – like Ogra – takes preventive measures to ensure quality control and safety parameters under the CNG Rules 1992, the other regulatory department can undo such actions by taking leverage of its own rules,” a petroleum ministry official said.

Industry sources say that the energy sector, already in disarray, is going to be subjected to further bureaucratic bottlenecks and unnecessary delays; as is typical of tussles between regulators under different ministries.

“The latest bone of contention will be the new rules, which are in total contravention of earlier rules framed by Ogra in 2001,” sources said.

Some sources claimed that the Ogra rules were more in line with international standards, and were updated from time to time based on new developments.

“The new rules have been framed without consulting experts and are prone to serious shortcomings in safety and technical standards,” the sources said; adding that the new rules give unprecedented discretionary powers to the CIE. According to sources, the domestic oil and gas Industry has protested the unilateral implementation of the new rules.

“The whole industry has been developed over the last twelve years based on rules defined by Ogra; these new rules will jeopardise investment in the oil and gas sectors,” sources said. They claimed that the rules would shatter confidence and prohibit the investments in an industry in dire need of organic expansion.

The local industry has also questioned the promulgation of new rules by a different authority despite an existing regulator, and has asked for an end to this confusion by seeking to revert back to rules framed earlier by Ogra.

Published in The Express Tribune, April 27^th, 2012.