Defending the recent increase in natural gas prices, union Petroleum and Natural Gas Minister M. Veerappa Moily Friday said the decision would benefit the country, as about 90 percent of the fossil fuel was produced by the state-owned companies.
"It is they (state-run firms like ONGC) which benefit the most from the price hike, as they produce 90 percent of the natural gas in the country. As they are state-owned, it is the government which will benefit and not private companies as they (like Reliance Industries) have just a small share," Moily told reporters on the margins of an event here.
Emphasising the need to be self-dependent in the energy sector, he said by further exploring oil and gas reserves within the country, the government could reduce the annual $160 billion fuel import bill.
The central government June 27 approved near doubling of natural gas prices to $8.4 per mmBtu from April 1, 2014, for all producers, including state-run and private sector firms, after the ministry's proposal was cleared by the Cabinet Committee on Economic Affairs headed by the prime minister.
One mmBtu (million metric British thermal units) is equal to around 1055.05585 joule, which is a unit of energy.
"Though 106 gas blocks have been discovered under the NELP (new exploring licensing policy), only six have been explored to extract gas and petroleum products since 1999. Even $1 billion investment in exploration will generate $500 million revenue to the exchequer," Moily said at an event to announce an 'Udyog Mela' (job fair) Aug 3-4 at Chikkaballapura, about 80 km from here.