The Ministerial Panel on Commercial Utilisation of Gas will meet tomorrow to re-prioritise the domestically produced gas allocation to consuming sectors.

With the gas output from Reliance Industries operated east coast block KG-D6 constantly on a decline and no other gas find getting commercial immediately, the panel headed by Defence Minister A.K. Antony has a tough task ahead to reconsider the sectoral priority of the available gas.

The Empowered Group of Ministers is expected to consider whether to accord equal priority to all core sectors — fertiliser, LPG, power and city gas distribution entities (for cooking and transport sector) and re-distribute the available gas among the core sector users pro-rated based on the signed gas supply agreements.

It could also consider maintaining status quo or accord equal priority to the fertiliser and power sectors.

Current output from D6 block is less than 15 mmscmd, which is not sufficient to meet even the core sector allocation made earlier.

Production from D6 started in April 2009 and reached its peak of 61 mmscmd in March 2010. The priority sectors including power were supplied full quantity till decline in production started from April 2010. To deal with this decline, pro-rate cuts were initially imposed across sectors between July 2010 and March 2011.

With the operator Reliance and its partners unable to control the decline in output, the Ministry for Petroleum & Natural Gas enforced a priority cut in the following order: non-core sector, city gas distributor sector, power, LPG, and fertiliser.

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