Entry-Exit System: Explained

1. Entry-Exit System for Gas Pipelines

Explained: Proposed Shift from Point-to-Point (P2P)

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PNGRB Vision 2040: Recommendation 70

"Recommends a study and stakeholder dialogue for adopting an Entry–Exit (E–E) tariff system."

P2P vs. E–E System Overview

🇮🇳 Point-to-Point (P2P) System CURRENT

What India currently follows:

  • •

    Shippers book capacity along a defined route, from a specific injection point to a specific offtake point.

  • •

    Requires multiple contracts tied to physical pipeline segments.

🌍 Entry–Exit (E–E) System GLOBAL STANDARD

What is an Entry–Exit (E–E) System?

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    Shippers book capacity at entry and exit points independently (where gas enters and leaves).

  • •

    They do not need to reserve a specific path through the network (Route-free nominations).

Example: P2P Contract Execution (KG Basin → GSPL LP)

If a customer in the GSPL LP line takes gas from KG Basin via: KG Basin → PIL → GSPL HP → GSPL LP. Shippers still execute a Point-to-Point contract, tied to actual pipeline segments. PNGRB applies a Unified Tariff and splits it internally among operators.

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2. India's Reality: The Unified Tariff (UFT) Catch

India has partly implemented E–E through the UFT, but it sits on top of the existing P2P booking system.

✔ UFT Implemented (Tariff Structure)

  • One tariff from entry to exit.
  • Pipeline operators share the tariff using entity-wise ratios.
  • Contractual paths published only for tariff allocation.

✘ True E–E Features Missing (Operational)

  • • Market-wide Entry–Exit capacity system
  • • Independent entry/exit bookings
  • • Virtual Trading Hubs (VTP)
  • • Route-free (any-path) nominations
  • • Title transfer at a national virtual point
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3. P2P vs. True Entry–Exit (E–E) Feature Comparison

Aspect India (UFT / P2P) True Entry–Exit (Global)
Booking Per pipeline segment Entry + exit points only
Contracts Multiple (per pipeline) Single contract
Nominations Per pipeline segment Single nomination at entry & exit
Routing Shipper follows physical path Operator manages internal routing
Tariff Single unified tariff Separate entry and exit tariffs
Billing Multiple invoices internally apportioned Shipper pays entry + exit; operator splits internally
Imbalances Per pipeline segment Overall entry–exit path
Title Transfer At each physical delivery point At a Virtual Trading Point (VTP)
Flexibility Low High
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4. Challenges for Full E–E Implementation in India

Old Contracts Need Updating

Current agreements were made for fixed routes; changing them may affect who gets how much gas and which pipelines are used.

Pipelines Aren’t Fully Connected

Many lines are still separate or dedicated to specific flows. Gas cannot move freely everywhere yet.

Fair Access for Everyone

Some operators also sell gas themselves, complicating open access. New rules must be redesigned for entry and exit points.

Operational Complexity

Operators must manage flows, nominations, and balances across a complex, multi-pipeline system.

Tracking Imbalances & Ownership

Shippers need new ways to manage differences between injected and withdrawn volumes and to allow trading at virtual points.

Getting Everyone On Board

Shippers and operators are used to the old system, and infrastructure in some regions is still developing.

Source: PNGRB Vision 2040 Report (Rec. 70) and associated studies on gas market evolution.

@Ranjith'EnergyDigest