PM sets up EGoM on Reliance gas price

PM sets up EGoM on Reliance gas price

New Delhi: Prime Minister Manmohan Singh today constituted an Empowered Group of Ministers to go into the issue of pricing of natural gas to be produced by Mukesh Ambani’s Reliance Industries from its eastern offshore Krishna Godavari basin block.

The Prime Minister conveyed the decision to set up the EGOM when Petroleum Minister Murli Deora met him this morning on the issue, official sources said.

RIL, drawing from its right under the contract for KG-D6 block, proposed to price the gas between 4.33 dollars per million British thermal unit and 4.58 dollars per mBtu. The rate was opposed by key consuming sectors like fertilizer and power in general and Mukesh’s younger brother Anil in particular.

Though the Petroleum Ministry was the competent authority to decide on the issue, Deora asked the Prime Minister’s Office to constitute a Committee of Secretaries to look into the issue.

The CoS, headed by Cabinet Secretary K M Chandrasekhar, in its report relied heavily on the ‘emotive´ issue of RIL gas supply to state-run power utility NTPC.

Sources said the EGOM would be headed by External Affairs Minister Pranab Mukherjee and would give its decision on the issue within a month.

When contacted, Deora said the sanctity of the contracts signed under New Exploration Licensing Policy (NELP) would not be compromised.