Oil's well that begins well

BACKSTAGE

It is fitting that a man who was in charge of the commodity exchanges as secretary in the department of consumer affairs is taking over as the petroleum regulator.

People who know Labayendu Mansingh, the first petroleum regulator, say he is a very amiable man. As the petroleum regulator, Mansingh will bring with him vast experience in regulation he has had during his close association with the Forward Markets Commission (FMC), which regulates the commodity exchanges in India.

Mansingh's is not a very well known name in the petroleum industry. Not many in the industry can tell what he is expected to bring to the petroleum sector as its first regulator. Only random words "" amiable, articulate, tough, experienced "" were thrown up to describe the man. "But that is a good thing. He will bring new ideas into the sector," a petroleum ministry official said.

Mansingh was not the expected name for the petroleum regulator's post. Other people with vast experience in the sector were touted to take over the regulator's job. "Mansingh's experience of overseeing the commodity exchanges will be of great use to him," the oil ministry official said.

The one quality Mansingh seems to possess is always being in the thick of the action. It was under him as the consumer affairs secretary that the Asian Development Bank extended a loan of $100 million for strengthening the commodity derivatives markets.

He was also actively involved in India importing 5 million tonnes of wheat in 2006 after a gap of six years. "And now he has the job of regulating the gas sector. Gas is the fuel of the future, and all the action in the future is going to circle around it," a government official associated with the setting up of the petroleum regulatory board said.

Mansingh, a Gujarat-cadre IAS officer, accepted the regulator's post after many others rejected it. The Petroleum and Natural Gas Regulatory Board Act was notified last year. A search committee to select a chairman for the board interviewed many candidates. However, each one of them rejected the post as the petroleum regulator was given a position which was equivalent to that of a secretary to the government of India.

"Whereas other chairmen of regulatory boards, such as the telecom regulator, are at par with the Cabinet secretary, it was not likely that a retired secretary would accept a post that would not give him higher benefits," the government official said. However, Mansingh, who was also formerly the Director General of Foreign Trade, accepted the chairman's post, after nearly a year of the commencement of the the search process. And that too without the chairman's post being elevated to a level equivalent to the cabinet secretary's.

The new job, industry players say, is not very well-defined. "From the look of it, the regulator's job appears to be one for pipelines only. Pricing, of gas for instance, is going to be outside his scope," a senior official of an oil company said.

The regulatory board under Labayendu Mansingh, however, has its work cut out. The board will not only set standards for future regulation in the gas sector, but also make the sector transparent. "That is our primary aim," one member of the board concluded.