New Delhi, June 29: The Group of Ministers (Gom) on natural gas pricing will meet on July 8 to deliberate on increasing gas prices by Rs 400 per thousand cubic metres to Rs 3250 per thousand cubic metres. "Gom will discuss the recommendation of the Committee of Secretaries to immediately hike the domestic natural gas prices from Rs 2850 per thousand cubic metres to Rs 3250 per thousand cubic metres", official sources said. The COS, which was asked by the group of ministers to look into deregulation of pricing of natural gas, also recommended maintaining gas price at Rs 3250 per thousand cubic metres for next two years while allowing oil and natural gas corporation to sell gas from joint venture fields at market rates. However, the market based pricing would not apply on one million standard cubic metres per day of gas produced from Cairn Energy of UK operated Ravva field "as it will have a severe impact on power consumers in Andhra Pradesh". The COS , sources said, has favoured de-linking of gas produced from JV fields like Panna-Mukta and Tapti on the west coast, which is fed to HBJ pipeline system.

"For new fields and additional production of gas over and above the current level of production by ONGC and Oil India Ltd, the price will be de-linked from the administered price mechanism and would be market determined", it suggested.

Sources said the recommendations, if accepted by the Gom, would go to the cabinet for final approval.

Interestingly, at the COS deliberations, petroleum ministry wanted price to be raised to Rs 3850 per thousand cubic metres but ministries of power and fertiliser conceded an increase of only Rs 400.

Bureau Report