The Comptroller and Auditor General of India has recommended that the Ministry for Petroleum and Natural Gas develop a mechanism for timely completion of natural gas pipelines and cut down on supply side delays.
In a report titled ‘Supply and Infrastructure Development for Natural Gas’ tabled in the Lok Sabha on Tuesday, the CAG found delays of over six years in GAIL implementing its projects and the same with Reliance Gas Transmission Infrastructure Ltd.
“Pipeline infrastructure which is a prerequisite for development of gas market was not taken up for development,” the report said.
The report also recommends that the Ministry should set up inter-ministerial committees with the Department of Fertiliser and Ministry of Power to suggest steps to improve supply the fuel to urea manufacturing units and power plants.
“A time bound action plan for synchronising implementation of natural gas pipeline projects and revival of fertiliser units so that benefit of the fuel maybe derived optimally besides reducing import of urea,” the report stated.
It added that a possible inter-ministerial committee with the Ministry of Power can suggest measures to supply natural gas, both domestic and imports, at an affordable price so that capacity created can be utilised.
The CAG also found under utilisation of the available natural gas to the fertiliser sector leading to import of more urea.
“This led to payment of an extra subsidy of ₹637.07 crore as the subsidy paid on imported urea was more than the subsidy paid on indigenously produced urea,” the report said.
The auditor has recommended to the Ministry to work out a mechanism to prevent diversion of natural gas supplied at a regulated price. It also recommended GAIL to critically review the natural gas supply contract management system and empower itself to adequately track the ultimate utilisation of natural gas supplies.