Tuesday, September 1, 2009

deora dares, plan panel strikes down

With Murli Deora asking for a reconstitution of the EGoM to allocate gas from the KG Basin fields beyond 40 million units, the Planning Commission instead wants the oil ministry to adopt the recommedndations laid out in the Integrated Energy Policy on the pricing of gas. Deora believes that there is a need to revive the mechanism so that gas can be allocated beyond the 40 million levels to new customers, but Montek Singh headed Plan Panel wants its recommendations to be reflected in the note that the oil ministry is preparing for the Cabinet on the contentious issue of gas pricing.

The Integrated Energy Policy contends that as the shortage of natural gas was likely to continue, its price, allocation should be independently regulated on a cost plus basis including reasonable returns. Deora who is known to do abrupt about turns on policy is now wondering what to do next. Though he met principal secretary to PM T K A Nair over the weekend to present his case for a new EGoM on the lines of the previous one headed by Pranab Mukherjee, it remains to be seen which path he will follow now.

Will his Cabinet note mirror realities or will they be full of flights of fancy in order to show his unstinted support to RIL chairman Mukesh Ambani? Or will he listen to the Plan Panel and take their recommendations on board. All this needs to be done quickly because with the Supreme Court deciding to hear the Ambani gas opera from October 20, Deora will find that time is not on his side. After all he will also have a role to play in the forthcoming Maharashtra elections. In what capacity, no one knows for sure?

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