Senior Left leader and CPI MP, Gurudas Dasgupta on Monday sought the intervention of Prime Minister, Manmohan Singh in preventing what he said was another huge scam on the lines of the 2G affair, this time in the Petroleum Ministry, if the corporate sector succeeded in twisting the government’s gas pricing policy to ensure windfall gains for itself. This would also lead to complete disaster for the country’s power and fertilizer sectors, he said.
In a letter to Prime Minister, released to the media here on Monday, Mr. Dasgupta accused the Petroleum and Natural Gas Minister, Veerappa Moily of making false statements to mislead the people. The gas pricing formula suggested by the Petroleum Minister overrides the Rangarajan Committee report and ensures that the import parity price of $14 per mbtu be given for the last two years of the five years for which the policy is valid, Mr. Dasgupta said. This would lead to massive gains for Reliance Industries Limited (RIL) and hurt the country’s economy badly, he added.
He regretted that despite writing to the Prime Minister on an earlier occasion and seeking an enquiry into the gas pricing formula, Manmohan Singh had not promised any probe and had only acknowledged the receipt of the letter. “This indicates the level of seriousness with which the Prime Minister treats this issue and speaks volumes about the functioning of the PMO,” he remarked.
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In his letter, Mr. Dasgupta said there is no talk of how much cost is being incurred in the production of gas from the KG basin of RIL. “If the price of gas is to be $14 mbtu in the last two years of the five-year period, an increase of $6 over the Rangarajan formula price of $8 mbtu, with a production level of 50 mmscmd in Kg-D6 and a crude oil price of $110 per barrel, then in each of the last two years, the subsidy outgo would be Rs. 21,750 crore over and above the Rangarajan formula. If we assume a profit split of 90:10 between RIL and the government, the increase in profit of RIL would be Rs. 39,250 crore,” the letter states.
He charged the Petroleum Ministry with completely by-passing the Rangarajan Committee in terms of the pricing formula, liquefaction and transportation costs for the last two years of the five-year policy which have been left to the Kelkar Committee, a clear attempt through the backdoor to give undue favour to RIL.