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Our Bureau

Hyderabad June 20 The exorbitant price quoted by Reliance Industries Ltd and the additional financial commitment at the consumer level work out to about Rs 1,352 crore per annum, resulting in an average tariff increase of 42 paise per unit in fuel surcharge for the Andhra Pradesh Government.

"Since my (AP) Government will not impose such a tariff shock, the burden of meeting this extra cost will fall on the State exchequer. In view of the critical importance of this issue to my State as well as the nation, I request the pricing methodology for sale of gas for the power sector be placed before the Cabinet for a decision," the Chief Minister, Dr Y.S. Rajasekhara Reddy, said in a letter to the Prime Minister.

Pricing issue

Expressing concern about pricing of natural gas, Dr Reddy today requested the Prime Minister, Dr Manmohan Singh's intervention on the pricing issue.

He said the issue of domestic natural gas was of great concern and the matter was raised during the Chief Ministers' conference on May 28 and also later at other forums.

Further, the Chief Minister pointed out that the Minister for Petroleum and Natural Gas, Mr Murli Deora, had promised in April 2007 that the State would be consulted regarding the pricing methodology for gas for the power sector.

As per the production-sharing contract there is a provision for the Government to opt for profit of petroleum either in cash or in kind. This has to be exercised by June 30, 2007 in the case of K-G basin gas. Considering the importance and shortage of time, an early decision would be required, he said.

More Stories on : Petroleum | Policy | Reliance Industries Ltd | Andhra Pradesh

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