No review of gas price hike decision: Moily

Clarifying on reports that the finance ministry wanted a cap on natural gas price, Petroleum Minister M. Veerappa Moily Thursday said there would be no review of the cabinet decision.

"There is no thinking on part of the government for any review or reconsideration of the decision of the CCEA (Cabinet Committee on Economic Affairs). Let me make it very clear. There is no confusion, there is no vagueness. And I don't think there is scope for any interpretation whatsoever," he told a press conference here.

The CCEA had on June 27 approved a new gas pricing policy that will come into effect from April 2014.

Based on a formula suggested by the C. Rangararajan Committee, the cabinet panel approved pricing of domestically produced gas at an average of cost of imported LNG into India and international hub rates.

The finance ministry had on July 4 written to the petroleum ministry asking it consider putting a cap up to which rates could be raised, as well as that Reliance Industries Ltd be forced to supply KG-D6 gas it had committed but failed to deliver in the past three years at their contracted rate of $4.2 per mmBtu (million British thermal units).

"The CCEA decision stands. There is no change. And government, not just Ministry of Petroleum and Natural Gas, is not contemplating any changes in it," Moily said.

The petroleum minister also said there would be no distinction between companies as far as gas pricing is concerned.

Moily clarified further that the price for natural gas for the April-June quarter of this fiscal comes to $6.83 per mmBtu as per the government's new gas pricing policy.

Dismissing reports that gas prices have been doubled as speculation, Moily said it was difficult at this point to estimate what the prices would be in April 2014.