The Prime Minister’s Office (PMO) has asked the petroleum ministry to considerably widen the scope of the newly-constituted empowered group of ministers (eGoM), which had the limited mandate of identifying new users for gas from the Reliance Industries offshore K-G D6 field, according to official sources.

The eGoM will, therefore, look at a wider gamut of policy issues relating to valuation and commercial utilisation of indigenous gas resources, rather than restrict itself to deciding who exactly will get the extra gas from the K-G D6 block, estimated to be 80 million standard cubic meters per day by 2014.

The eGoM, headed by finance minister Pranab Mukherjee, will also examine if the regulatory policy for the petroleum sector should be reviewed in this context, the sources said. A notification to this effect will be issued shortly.

Earlier, the power and fertiliser ministries had proposed that the regulator, the Petroleum & Natural Gas Regulatory Board, would have to widen its ambit to include upstream issues relevant to the gas sector such as the need for a transparent system to fix tariffs for transportation through pipelines. The department of fertilisers had repeatedly asked the petroleum ministry, the nodal ministry for gas policy matters, to formulate a policy conducive for fertiliser projects, which are stuck for want of assurance on gas supply.

“It is commitment on the quantity of gas supply that is more important for the fertiliser sector, than pricing,” a department of fertilisers official told FE. A policy that only stranded assets would get priority in gas allocation is irrational, as the proposed investment of Rs 48,000 crore in the fertiliser industry is contingent on assured gas supply, he added. Even the feasibility of the proposed overhaul of the fertiliser subsidy regime is dependent on how quickly the proposed investments would materialise.

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