Centre may hike gas rate from July 1

New Delhi: The government is likely to hike natural gas rates from July 1 after a new price formulation is approved by the Cabinet, a top oil ministry source said on Thursday.

The first increase in natural gas prices, based on a formula suggested by a panel headed by C. Rangarajan, was to be originally effective from April 1. However, before a new rate could be unveiled, general elections were announced and its implementation got deferred.

“It (gas price revision) is an issue which needs attention. Decision needs to be taken before July 1,” the source said.

The ministry had on April 21 told Reliance Industries, who was made to sell natural gas from its eastern offshore KG-D6 fields at the old rate of $4.2 per million British thermal unit even after its term had expired, that a new rate would be announced by July 1. “We had told RIL that the earliest possible date for applying the revised price is July 1 and so we have to annou-nce a new price before that,” he said. The ministry will announce a new rate once its gets clarity on implementation of the Ranagarajan formula.