Economy · Energy Sector (Power, Coal, Oil & Renewables)
The concept being tested: Petroleum and Natural Gas Regulatory Board (PNGRB) — regulatory scope.
Consider the following activities: I. Production of crude oil. II. Refining, storage and distribution of petroleum. III. Marketing and sale of petroleum products. IV. Production of natural gas. How many of the above activities are regulated by the Petroleum and Natural Gas Regulatory Board in our country?
The Petroleum and Natural Gas Regulatory Board Act, 2006 gives the Board jurisdiction only over the downstream segment of the value chain, specifically refining, processing, storage, transportation, distribution, marketing and sale of petroleum, petroleum products and natural gas. It has no jurisdiction over exploration and production, which stays with the Ministry of Petroleum and Natural Gas and the Directorate General of Hydrocarbons through production sharing contracts. Of the four listed activities, only refining, storage and distribution of petroleum, and marketing and sale of petroleum products fall within this downstream mandate. Production of crude oil and production of natural gas are both upstream activities and are expressly excluded from PNGRB's regulatory scope. That leaves exactly two of the four activities regulated by the Board, which is why only two is the correct count.
What UPSC was testing
The question tests whether aspirants know PNGRB regulates only the downstream chain, refining, processing, storage, transport, distribution, marketing and sale, and has no authority over upstream exploration and production. The trap is assuming a sector regulator covers the whole value chain including production, when the Act explicitly carves that out.
How often this comes up
This concept has appeared 5 times in UPSC Prelims General Studies Paper I between 2015 and 2025 — in 2016, 2019 and 2025.
The option-by-option autopsy for this question — why each of the other three is wrong, and which neighbouring concept each one was built from — is in the app.
Other past-year questions touching Energy Sector (Power, Coal, Oil & Renewables).