The ministry of steel has expressed concerns over the lack of gas supplies committed to steel companies for setting up gas-based plants.
The ministry has sought the Centre’s intervention to include its requirement in the list of priority industries including power and fertiliser. As per current policy, priority is given to power, fertiliser and transportation sectors over other industries. According to sources the steel ministry has requested that the quantity committed at the initial stages of setting up the gas-based steel plants, must be supplied.
However, as per the petroleum ministry, all available administered price mechanism (APM) gas from Oil and Natural Gas Corporation (ONGC) and Oil India Limited (OIL) would be supplied to the power and fertiliser sector against their existing allocations after meeting the requirement of specific-end users committed under court orders.
The total availability of APM gas from ONGC and OIL is 55 mmscmd, whereas the total supply to the power and fertiliser sector is about 49 mmscmd. The remaining 6 mmscmd would meet the requirement of consumers covered under court orders and the small-scale category. There is no more APM gas available for new consumers including city gas distribution. Any additional gas and future production of gas from new fields to be developed in future by ONGC and OIL will be sold in accordance with the production sharing provisions.
Sources also pointed out that the present supply of gas to Essar steel, which has sought restoration of the firm allocation of 3.11-mmscmd gas. granted by the gas linkage committee, has been curtailed to 0.7 mmscmd.