Govt may hike ONGC, OIL gas prices by 30 pc: Petroleum Secy | business | Hindustan Times
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Govt may hike ONGC, OIL gas prices by 30 pc: Petroleum Secy

The government may soon raise prices of natural gas produced by state-owned ONGC and Oil India by as much as 30 per cent, Petroleum Secretary S Sundareshan said today.

business Updated: Mar 22, 2010 15:30 IST

The government may soon raise prices of natural gas produced by state-owned ONGC and Oil India by as much as 30 per cent, Petroleum Secretary S Sundareshan said on Monday.

"I am told by the (Petroleum) Minister (Murli Deora) that the issue is in the final stages of decision making in the government. We expect a decision soon," he told reporters on the sidelines of the 6th Asia Gas Partnership Summit in New Delhi.

Price of gas produced by Oil and Natural Gas Corp (ONGC) and OIL from fields given to them on nomination basis were last revised in 2005. Current rates of Rs 3,200 per thousand cubic meters (USD 1.79 per million British thermal unit) are less than half of the USD 4.2 per mmBtu price of gas from KG-D6 field of Reliance Industries.

The Oil Ministry has circulated a Cabinet note for hiking price of gas under administered pricing mechanism (APM) to Rs 4,142 per thousand cubic meters (USD 2.32 per mmBtu).

Price of gas under APM is proposed to be raised in stages to Rs 7,500 per thousand cubic meters or USD 4.2 per million British thermal unit by 2013.

Sundareshan said the government was weighing policy options to end differential pricing of natural gas that ranges from under USD 1 per mmBtu (APM gas) to USD 5.73 per mmBtu (for gas produced by BG Group-operated Panna/Mukta and Tapti fields).