Cabinet to decide on doubling gas prices: Moily

New Delhi: The  Ministry will take a proposal for nearly doubling the price of domestically produced natural gas to $8-8.5 per mmBtu to the Cabinet after getting comments on its draft note.

In the draft note to the Cabinet, the ministry has proposed raising price of gas produced by state-owned ONGC and OIL during current year itself and that for Reliance Industries in 2014.

“That (draft note) is under circulations before all the ministries. And after consultations when the proposals come back to us from various ministries, we are going to move the cabinet,” Oil Minister M Veerappa Moily said. The Ministry in a draft note proposed accepting the Rangarajan Committee recommendation of pricing natural gas at an average of international hub prices and cost of imported LNG instead of present mechanism of market discovery.

It wants this pricing formula to apply to all forms of natural gas – conventional, shale and coal-bed methane (CBM). Also, the price determined shall be applicable to all consuming sectors uniformly.

Sources said the Ministry wants new pricing guidelines to apply from 2013 itself on all domestically produced gas.

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