RNRL in its communication sent on Thursday to the petroleum secretary RS Pandey also sought the ministry's intervention, asking RIL to end artificial scarcity of gas. RNRL alleged that the perception of scarcity ---a totally artificially created phenomenon is being exploited by RIL to extract a higher price of gas and make super normal profits.
RNRL argued that despite fall in the international price of gas, RIL's KG-D6 gas price during July 2008 and August 24 has actually gone up by over 20% in rupee terms. The gas price has been denominated in a foreign currency (US Dollars). This has led to an entirely unjustified annual increase, at peak production, of over Rs 3,700 crore for gas consumers.
Most of this unwarranted increase in gas prices will be borne by power and fertiliser consumers and will lead to a substantial increase in government subsidies. This aberration once again demonstrates the need for the entire gas pricing policy in India to be reviewed, not just on account of the denomination in a foreign currency, but also because of its lack of elasticity in response to sharp movements in global prices, the company said.
RNRL's letter comes at a time when the Supreme Court has convened hearing on cross petitions from RIL, RNRL and the petroleum ministry on the KG-D6 gas issue on September 1.