Reliance gas price hike subject to review: Supreme Court

The government's nod to Reliance Industries (RIL) to hike gas price produced from the KG basin is subject to review, the Supreme Court has ruled. The top court has adjourned the case to March 4.

The observations came during the hearing of a public interest litigation (PIL) filed by CPI MP Gurudas Dasgupta and NGO Common Cause.  Mr Dasgupta had alleged that Petroleum Minister  M. Veerappa Moily helped RIL to increase the price of gas produced from the KG-D6 offshore gas field.

In June 2013, the government doubled the price for locally-produced natural gas from $4.2 per million British thermal unit (mbtu) to $8.4 mbtu from April 2014, but the finance ministry later said prices for Reliance should be capped because the company's gas production from the offshore D6 block was far below its supply commitment.

However, last month, the Cabinet allowed RIL to charge higher prices for gas from April after the company offered financial guarantees to settle any claims against it over a shortfall in gas output.

Shares in RIL traded 1.2 per cent lower at Rs 855 as against a 0.2 per cent drop in the BSE Sensex as of 11.24 a.m.