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Reports of withdrawing EGoM note on RIL gas price hike 'baseless': Ministry

Last Updated: Thursday, November 22, 2012 - 09:20

New Delhi: The Petroleum Ministry Wednesday described as "baseless and frivolous" media reports that it had withdrawn a note detailing its opposition to any premature increase in price of gas from the Reliance Industries Ltd (RIL)-operated KG-D6 fields in Andhra Pradesh.

The note in question was prepared during the tenure of earlier oil minister S Jaipal Reddy for the Empowered Group of Ministers (EGoM).

The oil ministry said in a statement that "as per the routine procedure, the ministry has been advised to obtain approval of the new minister-in-charge before it is re-submitted to the cabinet secretariat".

"Therefore, news reports regarding withdrawal of the note at the behest of the present minister are completely baseless," it added.

The ministry clarified that RIL's request for revision of gas price was rejected in October 2010 itself, and it had already stated that no revision could be considered before it is due in 2014.

The ministry further said that gas pricing is one of the issues referred to the Rangarajan Committee constituted in July 2012.

The ministry note for EGoM had said the new price being suggested by RIL would push up the government's subsidy burden by USD 6.3 billion. A higher gas price would also impact power and CNG tariffs.

RIL had initially sought a premature hike on the ground of increased operational costs. However, the company later wrote to the ministry twice to say that it was only seeking an early start to discussions for the review.

The company has suggested a price of USD 14.2-USD 14.5 per unit, up from the USD 4.2 at present.


First Published: Thursday, November 22, 2012 - 09:11
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