The first meeting of the four-member secretaries’ panel set up to review the vexed issue of domestic natural gas pricing took place on Monday, where gas producers are believed to have highlighted that without a remunerative pricing regime they would not be able to ramp up output. On the other hand, natural gas users such as fertiliser and power firms argued that higher feedstock cost would lead to increase in end product price and also impact the government’s subsidy bill.
The stakeholders have been asked to submit their views in writing by August 28, said a senior official present at the deliberations. Meanwhile, inter-ministerial talks between finance, power, fertiliser and petroleum ministries are to take place. The panel will take at least two-three weeks to reach a conclusion.
It is understood that the discussions are revolving around the Rangarajan formula approved by the previous UPA government in June 2013. ?This is the only government-approved formula at the moment,? said another government official. It superseded the mechanism that was given the go-ahead by a Pranab Mukherjee-headed empowered group of ministers in 2007.
The meeting on Monday was attended by officials from RIL, Cairn India, ONGC, Association of Power Producers, and Fertiliser Association of India, among others. The secretaries? panel comprises power secretary PK Sinha, expenditure secretary Ratan P Watal, fertiliser secretary JK Mohapatra and additional secretary at the petroleum ministry Rajive Kumar Watal did not attend Monday’s meeting.
The exploration companies are also believed to have said gas pricing should be at arm’s length price as per the production sharing contract.
