Complete deregulation of natural gas prices would not be achieved by April 1, 2002, even after dismantling of the administered pricing mechanism in the petroleum sector, petroleum minister Ram Naik said today while addressing a press conference. Natural gas prices could not be brought to 100 per cent import parity with fuel oil "in one stroke.", he said, adding it would be done in a phased manner.
The linking of natural gas prices to 100 per cent import parity with fuel oil is expected to be effected in two yearly or three half-yearly installments. Currently, domestic natural gas has a price ceiling fixed at 75 per cent of import parity price of fuel oil. This ceiling of Rs 2,850 per million cubic metres is less than 50 per cent of international prices. He said the issues of natural gas prices, liquidation of oil pool deficit and subsidies on kerosene and LPG will be discussed at a meeting with finance minister Yashwant Sinha tomorrow.
The meeting would also firm up definitions in the draft regulatory bill for putting in place a downstream petroleum refining and marketing regulator, and would discuss steps to be taken in the last quarter of the current fiscal for dismantling of APM, Naik said.
The meeting would also decide on the mode and timing of issue of oil bonds to oil companies for liquidating the oil pool deficit, which is presently estimated at Rs 12,000 crore, he said.
