The petroleum ministry has made it clear to the Department of Fertilizers that marketing margin on gas is here to stay and it will not be rolled back. While marketing margins charged for non-administered gas is a commercial arrangement between the seller and buyer of gas, there is no going back on margins now charged for administered gas. The petroleum ministry has given the following explanation for charging margins on administered gas:
- The government's responsibility with regard to APM gas is different from its role with regard to non-APM or market price gas. APM gas is produced by National Oil Companies, ONGC & OIL, from blocks given to them on nomination basis by the government. Hence, decisions regarding pricing & marketing margin of APM gas are taken by the government, as these companies are government companies and the blocks from which APM gas is produced have been given to these companies on nomination basis by the government. The decisions were taken by the cabinet after consultation with all concerned ministries, including Department of Fertilizers
- Reliance KG-D6 gas: 13.5 cents/mmbtu
- RLNG: GAIL, IOC & BPCL are charging 18.67 cents/mmbtu (i.e., Rs.8.40/mmbtu or Rs.333/mscm) with annual escalation @ 5% as marketing margin.
- 8PMT JV: GAIL is charging 12.56 cents per mmbtu (Rs.5.65/mmbtu or Rs.224/mscm) as marketing margin for sale of PMT JV gas, as also for non-APM gas produced by NOC's.
- Ravva Satellite gas: GAIL charges 10.75 cents/mmbtu (Rs.l92/mscm) as marketing margin
- The charges are pegged to lUS$=Rs.45 and considering calorific value of 10,000 kcal/scm).
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