~~)~~IH ~ c;UCrRlCfimr fcl~~IIHCfi iITtPetroleum and Natural Gas Regulatory Board

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No.: Infra/CGD/BIDIR-3/7/GA/Jalandhar/01/2013 06.09.2013

To,Shri Satinder Singh MadhokDirector,Mis Jay Madhok Energy Pvt. LimitedD-143, Defence Colony,New Delhi 110024

Sub: Grant of Authorization for Geographical Area of Jalandhar CGDnetwork (Bid No. PNGRB/CGDIBIDIR-317/GA-JALANDHAR)

Sir,With reference to Bid No. PNGRB/CGDIBID/R-317/GA-JALANDHAR

and the Performance Bon submitted by you vide letter No. NIL dated 23rd

August 2013, please find enclosed the Grant of Authorization in Schedule-D ofthe Petroleum and Natural Gas Regulatory Board (Authorizing Entities to Lay,Build, Operate or Expand City or Local Natural Gas Distribution Networks)Regulations, 2008 for the Geographical Area of Jalandhar CGD network.

2. It may be noted that the authorization shall be governed by the provisionsof the relevant Regulations, various terms & conditions contained in the'Application cum Bid document' and the clarifications issued by PNGRB w.r.t.Bid No. PNGRB/CGD/BID/R-3/7/GA-JALANDHAR.

3. Kindly acknowledge this letter and send us the acceptance within 14 daysfrom the date of this letter.

Yours faithfully,

Encl: As Above

Schedule D[see Regulations 10 (J) and 18 (7)]

Grant of authorization for laying, building, operating or expandingJalandhar CGD network

To,

Shri Satinder Singh MadhokDirector,Mis Jay Madhok Energy Pvt. LimitedD-143, Defence Colony,New Delhi 110024

Subject: Grant of authorization for laying, building, operating or expandingCGD network in the authorized area of JALANDHAR under thePetroleum and Natural Gas Regulatory Board (Authorizing Entities toLay, Build, Operate or Expand City or Local Natural Gas DistributionNetworks) Regulations, 2008

Sir,

With reference to the application-cum-bid submitted by Mis Jay MadhokEnergy Pvt. Limited led Consortium for grant of authorization for laying,building, operating or expanding the CGD network in JALANDHAR, it hasbeen decided to grant the authorization to Mis Jay Madhok Energy Pvt. Limitedled Consortium subject to the Petroleum and Natural Gas Regulatory Board(Authorizing Entities to Lay, Build, Operate or Expand City or Local NaturalGas Distribution Networks) Regulations, 2008 and the following terms andconditions:

1. The Authorized Area for laying, building, operating or expanding theproposed CGD Network shall cover an area of 338 square kilometers andas depicted in the enclosed drawing.

2. The activities of laying, building, operating or expansion of the CGDNetwork to commence within a period of 180 days from the date of thisauthorization.

3. The activities permitted above shall have to be completed as per theapproved time schedule enclosed at Annexure-I. Any faiw.r~~~t1recpartFOlfeswara Rao

the entity in complying with the milestones prescrt~~ql'!~~~)IW1q; m

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schedule shall lead to consequences as specified under Regulation 16 of thePetroleum and Natural Gas Regulatory Board (Authorizing Entities to Lay,Build, Operate or Expand City or Local Natural Gas DistributionNetworks) Regulations, 2008.

4. The entity shall design and install an optimal size of the infrastructure interms of pipelines of various types including steel belting of the authorizedarea, online compressors of adequate capacity for compressing of naturalgas into CNG, allied equipments and facilities in the CGD network asidentified in its DFR depending upon the potential demand for natural gas.The infrastructure in the CGD network should be adequate to maintainuninterrupted flow of natural gas in the pipelines and be also able tomaintain supplies at adequate pressure to online CNG stations.

5. The entity shall maintain an uninterrupted supply of natural gas to allcategories of customers in the CGD network. In the event of any disruptionin the supply of natural gas in the CGD Network, first priority shall beaccorded to restoration of supplies to domestic PNG customers. In case ofdisruption of supply to domestic PNG customers for more than twelvehours, the entity shall compensate to the domestic customer on thefollowing basis:-

(a) the normative volume of natural gas consumption for the firstdomestic PNG connection for cooking requirements based on lastthree months weighted average consumption per day to be applied foreach day's disruption and multiplied by ten;

(b) normative value of natural gas consumption shall be based on lastthree months' weighted average billing price of natural gas forsupplies to the first domestic PNG connection for cookingrequirements; and

(c) the value of compensation shall be equal to normative volume ofnatural gas consumption as per clause (a) multiplied by normativevalue as per clause (b) and shall be adjusted by allowing a credit to thedomestic PNG Customer in the next billing cycle or in the next pre-paid smart card in case of smart card metering.

In case the disruption of supplies is attributed to any fault of the domesticPNG customer, no compensation shall be payable by the entity.

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Babar Road. New Delhi·l10001

6. The entity is allowed an exclusivity period under the Petroleum and NaturalGas Regulatory Board (Exclusivity for City or Local Natural GasDistribution Networks) Regulations, 2008, in respect of the following:

(a) 300 months from the date of issue of this communication for laying,building and expansion of the CGD network; and

(b) 60 months from the date of issue of this communication in terms of anexemption from the purview of common carrier or contract carrier forthe CGD network:

Provided that the entity meets the obligations in line with the Petroleumand Natural Gas Regulatory Board (Exclusivity for City or Local NaturalGas Distribution Networks) Regulations, 2008:

Provided further that the period of exclusivity allowed under sub-clause (a)or sub-clause (b) may be terminated before the expiry of the periodmentioned above in line with the provisions under Petroleum and NaturalGas Regulatory Board (Exclusivity for City or Local Natural GasDistribution Networks) Regulations, 2008.

7. The authorized entity shall be required to take prior approval from theBoard for creation of any lien, charge or hypothecation of the CGDnetwork to secure finances for the project and furnish details of utilizationof funds. However, in case of raising funds from any financial institution orbank, the entity will be required to only inform the Board ofthe sanction ofthe funds within a period of seven days.

8. The entity shall submit a detailed and clear financial closure report to theBoard within a period of one hundred and eighty days from the date ofauthorization issued by the Board under Regulation 10 of Petroleum andNatural Gas Regulatory Board (Authorizing Entities to Lay, Build, Operateor Expand City or Local Natural Gas Distribution Networks) Regulations,2008.

9. The entity shall publish the approved network tariff for transportation ofnatural gas as well as the compression charge for CNG in the CGD networkin the authorized area.

10. The entity shall publish the applicable retail selling price of PNG for allcategories of customers and also for the purpose of invoicing in Rs.zMMBTU. XT"Cl"/K.Rajeswara R "

(3m) 1050 (R)

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11. The entity shall publish and display the retail selling price of CNG for thepurpose of invoicing to CNG customers in Rs.! Kg at all CNG dispensingstations.

12. The furnishing of performance bond of Rs. 20 millions is a guarantee fortimely commissioning of the project as per the prescribed targets in the bidand for meeting the service obligations during the operating phase of theproject.

13. The entity shall abide by-

(a) the service obligations as specified under Regulation 14 of thePetroleum and Natural Gas Regulatory Board (Authorizing Entities toLay, Build, Operate or Expand City or Local Natural Gas DistributionNetworks) Regulations, 2008;

(b) the service obligations specified under the Petroleum and Natural GasRegulatory Board (Exclusivity for City or Local Natural GasDistribution Networks) Regulations, 2008;

(c) the service obligations specified in Schedule-l to the Petroleum andNatural Gas Regulatory Board (Authorizing Entities to Lay, Build,Operate or Expand City or Local Natural Gas Distribution Networks)Regulations, 2008;

(d) the quality of service standards as specified under Regulation 15 ofPetroleum and Natural Gas Regulatory Board (Authorizing Entities toLay, Build, Operate or Expand City or Local Natural Gas DistributionNetworks) Regulations, 2008.

14. In case the authorization of the entity is terminated, the Board may assignthe rights and obligations of the entity to any agency or another entity onsuch terms and conditions, as it may deem fit. Further, the entity may berequired, as per the directions of the Board, to continue the operations ofthe CGD network at the same level till another agency or entity appointedby the Board takes over the full control of the CGD network.

15. The entity shall comply with the applicable provisions under the Petroleumand Natural Gas Regulatory Board (Authorizing Entities to Lay, Build,Operate or Expand City or Local Natural Gas Distribution Networks)Regulations, 2008, Petroleum and Natural Gas Regulatory Board(Determination of Network Tariff for City or Loc%. ~~M~~ajeswar"

Distribution Networks and Compression Charge for CNG) R~i~~~~Ri,

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Yours faithfully,

2008, Petroleum and Natural Gas Regulatory Board (Exclusivity for City orLocal Natural Gas Distribution Networks) Regulations, 2008, relevantregulations for technical standards and specifications, including safetystandards, any other Regulations as may be applicable and the provisions ofthe Act.

16. The entity shall comply with any other term or condition which may benotified by the Board in public interest from time to time.

You are requested to confirm your acceptance by filling-in the acceptance of thegrant of authorization provided below and return the same in original. (Pleasenote that all pages along with the Annexure are to be initialed & stamped).

" ~ \:~ara RaoDated: C, 1" [".UI ! 3. ,""," f')SD('R)r" ,.q 'Pc 11 ,ru '''" .Y; : i ·1!nIRfi ~

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Petroleum & Natu~j>NGRB'dUry Boardi:j~ (ffi, qc;;:S s: -s <1~

1st Floor, World Trade Centre<WR ~r.s,~ R~l."OOO'

~ b Road NewDelhi·' 10001Acceptance of the Grant of Authorizatiorr" ar ,

I / We hereby accept the grant of authorization issued by the PNGRB videletter ref. dated andagree to comply with all the terms and conditions subject to which II We havebeen granted the authorization for laying, building, operating or expanding cityor local natural gas distribution network in the authorized area ofJALANDHAR.

Date:Place:

Signature of the Entity or Authorized Signatory

ANNEXURE-l

Milestones for the Project Implementation for Geographical Area ofJalandhar as per BID

Year Number of Domestic Inch-Kilometer ofCustomers Steel Pipelines

Year 1 46,800 7,020

Year 2 46,800 7,020

Year 3 46,800 7,020

Year 4 46,800 2,340Year 5 0 0

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