Relief for Reliance Industries, 12th Five Year Plan for gas producers charging market prices
The 12th Five Year (2012-17) Plan adopted by National Development Council (NDC) yesterday said, "Natural gas prices charged to producers must be determined by market forces".
Currently, majority of the natural gas produced in the country is priced at USD 4.2 per million British thermal unit, which is almost a third of the rate at which gas in its liquid form, called liquefied natural gas or LNG, is imported.
RIL and its partner BP Plc have been pitching for market price for the natural gas produced from eastern offshore KG-D6 fields.
"The concept of uniform gas price across consuming sectors also needs to be examined afresh as the desire to keep prices low for certain sectors tends to distort pricing; it is inconsistent with the principle that the price of gas will be determined by market forces," it said.
Addressing the NDC, Prime Minister Manmohan Singh had yesterday stated that natural gas as also coal and other liquid fuel rates in India were "well below international prices".
"If domestic energy prices are too low there will be no incentive to increase energy efficiency or to expand supply," he had said, adding, "Immediate adjustment of prices to close the gap is not feasible, but some phased price adjustment is necessary."
Demand for natural gas, the 12th Plan document said, will increase from 194 million standard
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