Energy – Centre Urges Andhra Pradesh to Follow Fuel Supply Rules
Energy- The Union Ministry of Petroleum and Natural Gas has asked the Andhra Pradesh government to reconsider recent directions that allowed oil companies to provide diesel in bulk at retail prices for development work in Amaravati. The advisory highlights concerns over regulatory compliance and safety in fuel distribution practices.
Centre Raises Regulatory Concerns
In a communication dated April 25, 2026, Petroleum Secretary Neeraj Mittal wrote to the state’s Chief Secretary, G Sai Prasad, drawing attention to existing legal provisions. The letter referenced the Petroleum Rules, 2002, along with norms issued by the Petroleum and Explosives Safety Organisation (PESO), which govern how fuel can be supplied and handled.
According to the ministry, retail fuel stations are authorised to dispense diesel only into vehicle tanks or approved containers, and that too within a limit of 200 litres. These outlets are not licensed to handle or distribute fuel in bulk quantities, as such operations require separate permissions and infrastructure.
Existing Mechanisms for Bulk Fuel Needs
The Centre clarified that oil marketing companies already operate systems designed to meet large-scale fuel demands. For projects such as infrastructure construction, bulk consumers are expected to rely on Direct Sales arrangements. These channels are specifically structured to deliver fuel safely and in compliance with legal requirements.
Additionally, the ministry pointed to the Door Delivery of Diesel scheme, which allows fuel to be transported through PESO-approved mobile units, commonly known as bowsers. This system ensures that diesel reaches construction sites and stationary equipment without breaching safety or licensing norms.
State’s Request for Amaravati Projects
The issue arose after the Andhra Pradesh Capital Region Development Authority sought assistance to ensure uninterrupted diesel supply for ongoing construction in Amaravati. Acting on this request, the State Civil Supplies Commissioner had approached oil companies to facilitate a total of 27,566 kilolitres of diesel between April and July 2026.
The demand was broken down month-wise, with 4,239 kilolitres required in April, followed by 8,880 kilolitres in May, 7,528 kilolitres in June, and 6,920 kilolitres in July. The intention was to maintain steady progress in capital city development projects that depend heavily on fuel-powered machinery.
Safety and Operational Risks Highlighted
The Centre’s letter stressed that diverting bulk fuel supply to retail outlets could lead to multiple challenges. These include safety hazards, operational inefficiencies, and violations of statutory regulations. Retail pumps are not equipped to manage large-scale fuel handling, which could increase risks during storage and transportation.
Officials also noted that bypassing established supply channels may disrupt uniformity in fuel distribution across regions. Maintaining a standardised system is essential to ensure accountability and prevent misuse or logistical complications.
Call for Adherence to Established Framework
The ministry has urged the Andhra Pradesh government to align its actions with the existing regulatory framework. It emphasised that while the scale of Amaravati’s construction work is significant, compliance with safety norms and legal provisions must remain a priority.
Efforts to obtain a response from the State Civil Supplies Commissioner, K Kanna Babu, were unsuccessful at the time of reporting.
The Centre’s position underscores a broader message: infrastructure growth must proceed within clearly defined regulatory boundaries, especially in sectors involving hazardous materials like petroleum products.