|Manmohan Singh in New Delhi on Tuesday. (PTI)
New Delhi, Dec. 3: Prime Minister Manmohan Singh today reiterated the importance of market-based pricing for oil and gas to ramp up their availability in the country, which is set to become the third largest energy consumer by the end of this decade.
“To bridge the demand and supply gap, the government is encouraging domestic and global companies to explore onshore and offshore regions. Market-based pricing and technology are essential to meet the nation’s needs in this regard.” Prime Minister Manmohan Singh said at a gas conference here.
He said oil and gas constitute around 41 per cent of India’s primary energy consumption. At present, the country is the fourth largest energy consumer behind the US, China and Japan.
India plans to launch the 10th round of oil and gas block bidding in January and allow private players who have won blocks in the previous rounds to explore shale gas in their existing blocks.
India, which imports about 80 per cent of its oil needs and more than half of its natural gas requirement, has market based pricing for crude but sub-market rates for gas.
A new pricing regime is envisaged from April 1, which will nearly double the rates to $8.4 per million British thermal unit but will still be lower than the market price.
“I take this opportunity to assure investors of the government’s commitment to providing a stable and enabling environment for exploration of new sources of energy,” Singh said.
Singh cited the example of the US shale gas revolution, where technology and market-based pricing helped to exploit the unconventional resource and turned the country into and an energy surplus.