Refuting allegations that favour had been shown to the Mukesh Ambani–owned Reliance Industries Limited (RIL) in the pricing of domestically produced natural gas, Petroleum and Natural Gas Minister Veerappa Moily on Friday said the new price would apply to all firms.
Terming the allegations made by Communist Party of India MP Gurudas Dasgupta motivated and false, Mr. Moily, in a statement here, said price increase was being effected strictly in line with the Rangarajan panel formula. “The new pricing, if approved by the Cabinet Committee on Economic Affairs (CCEA), will apply to all gas produced in the country. Two-thirds of the gas produced in the country are by PSUs and the new pricing will apply equally to them and they stand to benefit more out of it.”
Pointing out that price revision was a contractual requirement, Mr. Moily said it was also required to spur investment in oil and gas exploration, which had stagnated over the past few years. Gas finds in deep sea were not economically viable enough to develop at the current rate of $4.2 per mmBtu (million metric British thermal unit). “Mr. Dasgupta talks of fertilizer subsidy rising due to gas price increase but what he does not realise is that if domestic production does not increase, we will have to import gas.” Imported LNG cost three times the price of domestic gas, the Minister said.
