Background
The Petroleum Act, 1934, is an Act to consolidate and amend the law relating to the import, transport, storage, production, refining and blending of petroleum. Petroleum may be any liquid hydrocarbon or mixture of hydrocarbons, and inflammable mixture (liquid, viscous or solid) containing any hydrocarbon, and includes natural gas and refinery gas.
Various Compliances under Petroleum Act in Accordance with Petroleum Rules, 2002
No person is allowed to store petroleum without a valid license, except as provided in Sections 7, 8, and 9 of the Act.
License is not required for:
No one shall import, transport or store any petroleum save in accordance with the rules made under section 4.
a) Petroleum shall only be delivered to those holding a storage license or their authorized agents, port authorities, railway administrations, or those authorized under the Act.
b) The petroleum delivered must match the authorized class and quantity the recipient is permitted to store under the Act.
c) Petroleum Class B, up to 15,000 litres in sealed airtight approved containers, may be dispatched to a person without a storage license, provided the sender ensures the recipient has arrangements for immediate disposal of up to 2,500 litres. If over 2,500 litres, a dry chemical fire extinguisher must be available.
d) These rules do not apply to deliveries to the Union’s Defence Forces or kerosene deliveries to licensed decanting operators, provided the sender confirms arrangements for immediate disposal of up to 2,500 litres.
Licence Not Required for Transport/Storage of Petroleum:
A person need not obtain a licence for the import, transport or storage of petroleum Class A that is not intended for sale if the total quantity in his possession does not exceed thirty litres.
Certificate of testing is given by the Testing Officer after testing samples of petroleum and it states whether the petroleum is petroleum Class A or petroleum Class B or petroleum Class C and if the petroleum is petroleum Class B or petroleum Class C, the flash-point of the petroleum.
The owner of any petroleum, or his agent, who is dissatisfied with the result of the test of the petroleum may, within seven days from the date on which he received intimation of the result of the test, apply to the officer empowered under section 14 to have fresh samples of the petroleum taken and tested.
Whenever there occurs in or about, or in connection with, any place in which petroleum is refined, blended or kept, or any carriage or vessel either conveying petroleum or on or from which petroleum is being loaded or unloaded, any accident by explosion or by fire as a result of the ignition of petroleum or petroleum vapour attended with loss of human life or serious injury to person or property, or of a description usually attended with such loss or injury, the occupier of the place or the person for the time being in charge of the petroleum or the person in charge of the carriage or the master of the vessel, as the case may be, shall give notice thereof and of the attendant loss of human life, or injury to person or property, if any as follows:
a) to the Chief Controller by telephone/fax and email or other electronic modes of communication and also by telegram telegraphic address- ‘Explosive Nagpur’ followed within 24 hours by a letter giving particulars of the occurrence; and
b) to the officer-in-charge of the nearest police station by the quickest means of communication
Pending the visit of the Chief Controller or his representative, or until instruction is received from the Chief Controller that he does not wish any further investigation or inquiry to be made, all wreckage and debris shall be left untouched except in so far as its removal may be necessary for the rescue of persons injured and recovery of the bodies of any persons killed by the accident or in the case of Railways for the restoration through communication. Provided that such a visit by the Chief Controller or his representative shall be made as expeditiously but not later than seven days from the date of notice of such accident
No person shall cause to be repaired or repair by the use of hot work any tank or container which had petroleum unless it has been thoroughly cleaned and freed from petroleum and petroleum vapour or otherwise prepared for safely carrying out such hot repair and certified, in writing, by a competent person or TPIA
Precautions must be taken to prevent petroleum from entering drains, sewers, water bodies, or spilling over land, roads, or railways.
Unless expressly provided in these rules, no person shall smoke and no matches, fires, lights or articles or substances capable of causing ignition of petroleum shall be allowed, at any time in proximity to a place where petroleum is refined, stored or handled or in a vehicle’s carriage or vessel in which petroleum is transported.
No person shall commit or attempt to commit any act, which may tend to cause a fire or explosion in or about any place where petroleum is refined, stored or handled, or any vehicle’s carriage or vessel in which petroleum is transported.
Every person storing petroleum and every person in charge of or engaged in the storage, handling or transport of petroleum shall at all time,
(a) comply with the provisions of these rules and conditions of any licence relating
thereto;
(b) observe all precautions for prevention of accident by fire or explosion; and
(c) prevent any person from committing any act referred to in Rule 12(1)
Petroleum products can be imported without a licence if prior arrangements are made to receive and store them in licensed premises.
Petroleum exempted:
(1) Nothing in this chapter II applies to Petroleum Class B or Petroleum Class C comprising in a ship’s stores and manifested as such;
(2) Nothing in rules 14, 19 and 26 shall apply to petroleum imported by the Defence Forces of the Union
Petroleum can be imported by sea only through ports approved by the Ministry of Shipping Government of India, in consultation with the Chief Controller and declared as Custom’s ports by the Commissioner of Customs.
No person shall import any ISO tank container filled or intended to be filled with petroleum without obtaining import permission from the Chief Controller or Controller
Every person desiring to import petroleum shall furnish personally or through his agent to Commissioner of Customs,
a) certificate of storage accommodation in Form II signed by such person or his agent; and
b) licence or an authenticated copy of licence for the import and storage of such petroleum:
No imported petroleum shall be landed except with the permission of the Commissioner of Customs
Where consignee furnishes a guarantee to re-ship petroleum if testing officer’s report proves unfavourable, Commissioner of Customs may in anticipation of testing officer’s report permit any petroleum which he believes to be Petroleum Class B or Class C to be discharged into boats or to be landed
The permission granted shall be subject to the conditions that the boats into which the petroleum is discharged shall remain at such place as the Conservator may specify or that the petroleum shall be landed at a landing place duly specified for the purpose by him and stored in an installation licensed under these rules
Subject to the provisions of Part II of Chapter III, petroleum imported in bulk shall be discharged into storage tanks on shore either directly or by means of barges or lighters specially constructed for carrying petroleum in bulk and only at such places as the
Conservator may by general or special order direct.
Subject to the provisions of Part II of Chapter III, petroleum imported otherwise than in bulk shall be landed either at jetties provided for the purpose, or in barges or lighters and only at any such places as the Conservator shall direct.
No petroleum contained in containers shall be landed unless such containers are free from leakage and are of such strength or construction as not to be liable to be broken or to leak except in cases of gross negligence or extraordinary accident. Provided that petroleum contained in containers, which do not satisfy the requirements of this sub-rule, may subject to provisions of Part II of Chapter III and to
such conditions as the Conservator may impose, be landed at separate landing place approved for the purpose.
Petroleum may be transhipped from one ship to another for conveyance to any other port, whether within or beyond the territory of India subject to the provisions of Part II of Chapter III.
No petroleum shall be imported into India by land except at places specially authorized for the purpose by the Central Government.
Every person desiring to import petroleum by land shall furnish to the Commissioner of Customs a declaration in Form I, a certificate of storage accommodation in From II and the licence or its authenticated copy held for the importation and storage of such petroleum
No petroleum shall be unloaded except with the permission of the Commissioner of Customs.
No petroleum shall be imported by air except at the airports authorised for this purpose by the Central Government in consultation with the Chief Controller.
Person desiring to import petroleum by air shall furnish to Commissioner of Customs, declaration(FORM I), certificate of storage accommodation(FORM II), copy of licence for import & storage, landing permit from DG of Civil Aviation & consent letter from flight operator for transport of petroleum
No petroleum shall be unloaded except with the permission of the Commissioner of Customs.
No leaky tank or container containing petroleum shall be tendered for transport.
Barrels, drums and other containers filled with petroleum shall be loaded with bung upwards.
Save as provided in rules 38, 39 and 52 and clause (b) of rule 60, no ship, vessel or vehicle shall carry petroleum, Petroleum Class A or Petroleum Class B and Class C in bulk if it is carrying passengers or any combustible cargo other than petroleum
No person while engaged in loading or unloading or transporting shall smoke or carry matches, lighters or other appliances capable of producing ignition or explosion.
Provided that,
(a) nothing in this rule shall apply to vessels registered in a country other than India importing petroleum;
(b) petroleum in tank vehicles may, with the permission, in writing, of the Chief Controller and subject to such conditions as he may specify, be transported across a river by a ferry.
Every ship or other vessel carrying petroleum in bulk, other than a ferry permitted to transport tank vehicles under clause (b) of the proviso of sub-rule (1) of rule 33, shall be made of iron or steel well and substantially constructed with scantlings of ample dimensions in proportion to the size of the vessel
The licensing authority may, in special circumstances, allow use of such ships
or other vessels constructed of materials other than iron or steel under such conditions as it may, in consultation with the Chief Controller, specify.
Rule 35 of Petroleum Rules 2002 apply for the transport of petroleum other than petroleum Class C in ship or other vessels
Conditions for self-propelled barges transporting petroleum (excl. Petroleum class C):
i) Entire machinery must be located at the stern.
ii) Machinery must be fully separated from cargo by a cofferdam with two transverse petroleum-proof bulkheads, and space between them must be at least 75 cms
Petroleum in bulk shall not be transported in a barge or flat unless the barge or flat is selfpropelled or is in tow of, or otherwise, attended by, a steamer or tug and carries:
(a) at least four fire extinguishers suitable for extinguishing oil fires and a covered sand box, on deck, containing at least 0.20 cubic metres of dry sand
(b)a suitable hammer of non-sparking metal
(c) a red flag.
No ship or other vessel shall carry petroleum in bulk if it is carrying passengers, or any inflammable cargo other than petroleum or coal.
This rule shall not apply to Petroleum Class C used as fuel and carried in cellular double bottoms under engine and boiler compartments and under ordinary holds; such fuel oil tanks and installations connected therewith shall comply with the provisions of the Indian Merchant Shipping (Construction and Survey of Passenger Steamers) Rules, 1956.
No steamer or tug employed in towing or otherwise attending a barge, flat or lighter carrying petroleum, other than petroleum class C in bulk, shall at the same time tow or otherwise attend any other vessel carrying an inflammable cargo other than petroleum or coal.
Before any petroleum is discharged from a ship or vessel, the holds of such vessels shall be thoroughly ventilated. Provided that nothing in this sub-rule shall apply to any vessel carrying Petroleum Class A not exceeding 30 litres or Petroleum Class B not exceeding 2,500 litres or Petroleum Class C.
The Master or other officer in charge of any vessel which had carried petroleum on board whether as a cargo or as a fuel, or any vessel licensed under rule 33 shall be responsible to see that all due precautions are taken for the prevention of accidents due to ignition of petroleum or petroleum vapour
Petroleum in bulk shall not be loaded or unloaded into or from any ship/ barge at any place unless,
(a) the location is notified or permitted by the Central Government and the facilities are approved by Chief Controller under rule 16, in case of import, or
(b) the location and facilities for loading or unloading are approved by the Chief Controller, in cases other than import.
When the loading or unloading of petroleum has commenced, such loading or unloading shall proceed with due diligence and, if it is discontinued, the tanks, and holds of the ships or other vessels concerned and all loading or unloading valves shall be closed immediately.
During loading or unloading of a ship or vessel, and until all petroleum is loaded or unloaded and the holds or tanks are securely closed and free from flammable vapors, there shall be no fire, artificial light, or smoking on board or within 30 meters of the operation area.
Vessels unloading or loading petroleum shall have adequate fire-extinguishing appliances so disposed that they can be put into immediate use.
Petroleum imported through ports approved under Rule 16(1) and (2), but not tested as per Chapter X, shall not be transported to any port except those approved under Rule 16(1) and only in compliance with all provisions of Chapter II.
The provisions of Rules 62 to 86 of the Petroleum Rules, 2002 (including amendments) apply to the transport of petroleum by land via vehicles. However, these rules do not apply to:
Permission for transportation of Petroleum Class A or Class B by road in ISO tank containers shall be obtained from the Chief Controller or Controller by submitting an application in Form VII-A. Such permission shall remain valid for a period of one year from the date of its issuance.” (As per 2024 Amendment)
Rules pertaining to transport of petroleum by means of pipelines other than those in any area in which operation for the winning of natural petroleum or natural gas or both are carried on or within the limits of refineries and installations are covered in Rules 87 to 101 of Petroleum Rules 2002
Save as provided in this chapter, no electric wiring shall be installed, and no electric apparatus shall be used in any refinery, installation, storage shed, service station or in any other place where petroleum is refined, blended, stored, loaded or unloaded.
All fixed electric wiring in any hazardous area shall be done as laid down in Rule 107 of Petroleum Rules 2002.
All operations within an installation, service station, or storage shed shall be carried out under the supervision of an experienced and responsible agent or supervisor who is well conversant with the terms and conditions of the licence applicable to the respective premises. Such personnel must also possess proper safety training
The ground in the interior of an installation or service station and the protected areas surrounding any installation, service station or storage shed shall be kept clean and free from all vegetation, waste material and rubbish
All enclosures surrounding above ground tanks in an installation shall be provided with proper drainage facilities in such a way that no water is allowed to accumulate in the enclosures. No part of the enclosure shall be below the level of the surrounding ground within the protected area.
The protected area surrounding every installation and storage shed shall be surrounded by a wall or fence of at least 1.8 metres in height.
No installation, service station or storage shed shall, without permission in writing from the Chief Controller be used for any purpose other than the storage and distribution of petroleum and for purpose directly connected therewith.
The capacity in litres or kilolitres of every above ground tank in an installation shall be conspicuously marked on the tank.
All tanks or other receptacles for the storage of petroleum in bulk, other than well-head tanks installed on the ground or below the ground, shall be protected against corrosion by the use of protective coatings or cathodic protection or by any other means approved by the licensing authority.
Storage tank or receptacle for the storage of petroleum in bulk, other than well head tank, after being installed and secured in final position or after undergoing re-installation or any major repair, shall, before being put into use, be tested by water pressure specified in the tank construction code or specifications by a competent person or TPIA
Storage tanks or other receptacles for storing bulk petroleum (excluding well-head tanks) must be tested by water pressure by a competent person/TPIA after installation, re-installation, or major repair. A Certificate of Tank Testing shall be issued after the test.
Every tank or other receptacle for the storage of Petroleum in bulk, other than a well head tank or tanks of less than 50,000 litres capacity containing Petroleum Class C shall be electrically connected with the earth in an efficient manner by not less than two separate and distinct connections placed at the opposite extremities of such tank or receptacle. The roof and all metal connections of such tank or receptacle shall be in efficient electrical contact with the body of such tank or receptacle.
The connections and contacts of the tank or receptacle required under rule 127 shall be inspected and tested by a competent person at least once in every twelve months by means of a direct reading instrument, such as a Megar.
Certificate of Safety to be submitted to the Licensing authority before any petroleum is stored in an installation or a service station for the first time or whenever any addition to the enclosure walls and embankments are carried out or when any tank is repaired or installed or its position shifted.
Every person desiring to obtain a licence to import and store petroleum in Form XIV, Form XV, Form XVI or in Special Form, as the case may be,shall submit to the licensing authority an application along with specifications and plans of premises proposed to be licensed.
Where the licensing authority is the Chief Controller or the Controller, as the case may be, an applicant for a new licence other than a licence in Forms III, XI, XVII, XVIII, or XIX shall apply to the District Authority with two copies of the site-plan showing the location of the premises proposed to be licensed for a certificate to the effect that there is no objection, to the applicant receiving a licence for the site proposed and the District Authority shall, if he sees no objection, grant such certificate to the applicant who shall forward it to the licensing authority with his application Form IX
There shall be no requirement of No Objection Certificate from District Authority under sub–rule (1) for a licence in FORM XIV forming a part of the CNG station licensed in FORM “G” under the Gas Cylinder Rules, 2016 or Auto LPG dispensing station licenced in FORM “LS-1B or LNG dispensing station licensed in FORM “LS1C” under the Static and Mobile Pressure Vessels (Unfired) Rules, 2016
No alteration shall be carried out in the licensed premises until a drawing or drawings showing such alteration has been approved in writing by the licensing authority.
A licensee who desires to have his licence amended shall submit to the licensing authority, an application in Form VII if the licence has been granted for transport of petroleum in bulk by road, in Form VIII, if the licence has been granted for refueller in Form XIX, in Form IX if the licence is granted to import and store petroleum and in Form X, if the licence is granted to decant kerosene (Petroleum Class B) from mechanically propelled vehicles in containers.
Every License granted in Form XI may be renewed for a maximum period of 10 years counted as 365 days or its multiple from date of grant of license where there has been no contravention of Act/rules/any conditions of the license so renewed
The holder of a licence, for the storage of petroleum may, at any time before the expiry of the licence, apply to the licensing authority to transfer the licence to another person.
In case of death, insolvency, or disability of a licensee, the person carrying on the business may continue to operate without penalty for a reasonable period, to allow time for applying for a new licence for the remaining term of the original licence.
List of various Licenses required under Petroleum Act 1934
Form Number | License Name |
|
|
Form VII | License to transport petroleum in bulk by road in mechanically propelled vehicles |
FormVIII | License to transport petroleum class A/B in bulk on land |
Form IX | Licence to import and store petroleum |
Form X | License to decant kerosene(Petroleum Class B)from mechanically propelled vehicles containers |
Form XII | Licence to import & store Petroleum Class A up to 300 lt in a storage shed/approved bin |
Form XIII | Licence to import and store Petroleum Class B otherwise than in bulk up to 25,000litres. |
Form XIV | Licence to store Petroleum in tanks w.r.t with Pump outfit for fuelling Motor Conveyances |
Form XV | Licence to Import and Store Petroleum in an Installation |
Form XVI: | License for Import & Store of Petroleum ClassA>300Lt,ClassB> 25,000Lt, Class C>45000Lt,etc |
Form XVII | License to Decant Kerosene (Petroleum Class B) from Mechanically-Propelled vehicle |
Form XIX | License to transport Petroleum Class A/B in bulk on land by mechanically propelled vehicles |
General penalty for Non- Compliance
Section 23: Contravention of provisions of Chapter I or any Rules in relation to import, transport, store, production, refinement or blending any petroleum shall be punishable with simple imprisonment which may extend to one month, or with fine which may extend to one thousand rupees, or with both
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