Gas Price Row: Aam Aadmi Party Asks State Govt to Sue Reliance

Aam Aadmi Party’s state campaign committee on Thursday demanded an immediate CAG audit into

Published: 28th February 2014 08:57 AM  |   Last Updated: 28th February 2014 09:09 AM   |  A+A-


Aam Aadmi Party’s state campaign committee on Thursday demanded an immediate CAG audit into Reliance gas issue and urged that the state government should take Reliance Industries to court for not supplying gas to the power plants, fertilizer companies and transport sector as per contract.

Speaking at a press conference in the city, B Ramakrishna Raju, state campaign committee convener alleged that Reliance had deliberately reduced gas production in the KG basin natural gas reserve due to which only 600MW of gas-based power was being produced instead of the installed capacity of 2,770 MW. The activist demanded that these gas- powered plants should be immediately operated at full capacity for avoiding power cuts.

Raju said that the Government of India’s decision to pay Reliance $8.4 per MBTU from April 1, instead of $4.2 per MBTU, would increase the cost of power by Rs 2 a unit and result in an extra burden of Rs 4,000 cr on the people of AP.

“The Centre should immediately reverse the decision. The cost of production per MBTU is only $2.75 and as per original contract, Reliance agreed to supply gas at $2.34 per MBTU. Now, the price is being hiked to $8.4. Politicians across political parties are hand in glove and are therefore maintaining silence,” he said wondering why the payment was in terms of dollars when the company involved was an Indian company.

Kiran Kumar Visssa, secretary of AAP’s state campaign committee, questioned why the government of AP could not file an FIR against Reliance based on a complaint from former Union secretaries EAS Sarma and T Subramaniam, to protect the interests of the state even after the then AAP government in New Delhi had taken the first step against the corporates. “Reliance is hoarding the gas and only 18 per cent of gas that is promised as per agreement is being generated. Today, the state is reeling from power shortages and Reliance will increase production after April 1, eyeing windfall profits,” he said adding that the production sharing contract had no provision for increasing the price of gas once the field has become commercial.

Chakri, an AAP member, pointed out that the increase in gas prices would increase the price of fertilisers and thus hit the farmers who were already in crisis. “The government today is forced to buy power at high cost from open market for which consumers are paying fuel surcharges and are burdened with power cuts. If all the idle power generation plants are operated after due production of agreed gas, there will be no power crisis” he said.

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