Centre promises AP gas for power, fertiliser plants

Hyderabad, Apr 5 (UNI) Assuring Andhra Pradesh Chief Minister Y S Rajasekhara Reddy of meeting the state's needs of gas for power and fertiliser plants, Union Minister for Petroleum and Natural Gas Murli Deora today said the capacity of Oil and Natural Gas Corporation's refinery at Kakinada would soon be doubled to 15 million tonne.

During talks with Mr Deora, the Chief Minister staked a claim to profit from gas under the production sharing agreement with Reliance Industries and other explorers, an official release said.

Pressing for early supply of gas to meet the rising demand for power, Dr Reddy explained to the Union Minister that four gas-based power projects for which PPAs were signed by the earlier government, were awaiting natural gas. Some existing power plants too were not receiving allotted gas fully.

Dr Reddy said the State was compelled to pay higher prices for gas from Ravva and other fields as GAIL failed to keep its commitments.

He said because of mistaken commitments given by the previous government at the Centre on gas supply, the State was reeling under severe power shortage.

Responding, Mr Deora said natural gas from the K-G Basin would be supplied by Reliance and other private developers beginning from June 2008, without fail.

On the issue of gas pricing, he said the Centre would take the final decision on the pricing formula before June 2007.

The Chief Minister requested the Petroleum Ministry to ensure that no portion of gas produced in K-G Basin was allowed to be taken out of the State before first meeting the State's entire requirements.

The Chief Minister said pricing of natural gas was very critical.

Under no circumstances should prices be fixed linking them to international gas prices, he stressed.

He also sought an increase in allocation of kerosene for distribution under the Public Distribution System (PDS) from 55,356 KLs to 71,833 KLs per month. He wanted permission to distribute LPG cylinders through the PDS network.

Mr Deora, who was accompanied by Union Minister of State for Petroleum Dinshaw Patel, Petroleum Secretary Srinivasan and officials of ONGC, GAIL, IOC, HPCL, promised to extend full support to the state. The Centre would make efforts to ensure that natural gas in the K-G Basin was supplied as CNG for use in automobiles.

UNI