Government likely to levy cess on natural gas

The government is likely to levy a cess on natural gas produced in the country in order to fund the construction of gas pipeline network, according to petroleum secretary R S Pandey.

The government, he said, is planning to build a national gas highway network criss crossing the country to transport the environment friendly fuel to regions untouched till now, a senior official said on Wednesday.

Utilisation of the huge gas finds will give the government a huge opportunity to raise revenues - a 20 cents per million British thermal units cess levied on gas price should yield Rs3,000 crore revenue in a year, Pandey said while addressing the India Energy Forum meeting in New Delhi.

These funds will be enough for the construction of 500-600 km of natural gas pipeline in a year so that over a period, the whole country can be networked through gas pipelines.

Pandey, however, said plans are at a preliminary stage and a proposal to this effect is yet to be moved to the government for consideration.

India will soon be producing over 150 million cubic meters of gas a day,  including from Reliance Industries and ONGC from offshore blocks.

Like the nation's first cross-country Hazira-Bijaipur-Jagdishpur (HBJ) pipeline, Pandey said, natural gas wolf transform the whole of India, he said.

But, without the necessary infrastructure to transport gas to southern and eastern regions, there cannot be any major change in the gas scenario in the country, he said, adding, "For equitable economic development, there is a need for a criss-crossing National Gas Highway."