The Hindu Business Line : Aiyar hints at deregulating natural gas prices

THE Petroleum Minister, Mr Mani Shankar Aiyar, today gave notice to commercial consumers of natural gas to gear up for paying market-related prices for the product.

He was speaking at the Third National Gas Conservation Programme, here today.

The Supreme Court had taken the view that only transport, power and, certain small sector companies could be given special treatment, the Minister said.

"The demand is much more and there is strong need to increase supplies. Besides, the price element cannot be ignored for long. The era of cheap gas is behind us. Administered price mechanism is not possible for the gas sector," the Minister added.

Mr Aiyar also suggested a greater synergy between the panchayats and energy conservation agencies. With 2.5 lakh elected institutions having 30 lakh representatives, panchayats could play a major role in making gas conservation a mass effort, the Minister said. He also stressed the need for revamping and reorienting the Petroleum Conservation Research Agency.

LNG for Dabhol: As regards supply of liquefied natural gas for the Dabhol Power Plant, now re-launched by GAIL (India) Ltd led consortium, the Minister said, he had a conversation with his Qatari counterpart, and was expecting to hear from them within next few days.

Petro product prices: On whether his Ministry had any immediate plans to increase the petroleum product prices for domestic consumption, Mr Aiyar said he would present to the Energy Coordination Committee (EEC) headed by the Prime Minister, Dr Manmohan Singh, options for bridging the gap between cost of producing liquefied petroleum gas and kerosene and their retail selling price. The EEC meet is slated for Friday.

"Since I say that oil prices in international markets have gone up it does not necessarily mean that prices will have to go up here too," the Minister pointed out.

He said that the options before his Ministry were either to make no change in petrol, diesel, LPG and kerosene prices despite the rise in cost or remove all controls and let market prices prevail. There could also be a midway where prices were raised marginally and controls continued, he said, adding that all the options and their impact would be presented to the ECC.

Gas conservation: During his address at the conference, the Minister said that instead of celebrating the National Gas Conservation Day every year on December 14, GAIL, as well as the industrial sector, should make gas conservation a continuous part of their ongoing process and activities.

GAIL has instituted awards for the best energy efficient industries across eight industrial sectors that included fertiliser, power, sponge iron, glass, petrochemicals, LPG fractionators, gas compressor stations and the small-scale sector.

NTPC Gas Power Station, Faridabad; Videocon Narmada Glass, Bharuch; Hind Glass Industries, Ferozabad; Nagarjuna Fertilisers & Chemicals Ltd, Kakinada; Vikram Ispat Ltd, Raigad; H R Johnson, Mumbai, were some of the winners this year.