Increase gas production to reduce oil import bill: Sharad Yadav

NEW DELHI: Government should increase gas production from indigenous sources, particularly from coal, to reduce burgeoning oil import bill and fiscal deficit, JanataDal (United) chief SharadYadav said today.

"The use of indigenous gas can be increased manifold if reliable gas supply is assured through development of new blocks. The cost of such gas will be much cheaper than today's gas price and may be one-fourth of imported gas," he said in a statement.

Pitching for providing fiscal benefits to new technologies like coal gasification, coal bed methane (CBM) and shale gas to increase gas production, he said that " Government of India should use its natural resources in a judicious manner which will help in reducing the fiscal deficit of the country".

The JD(U) chief and NDA Convener also asked the government to focus on extracting gas from coal blocks before mining starts in a block and demanded to incorporate his suggestions in the upcoming Budget.

Moreover, he demanded to allocate mining areas containing gas to public sector firms like Coal India (CIL), ONGC and Oil India (OIL) on a nomination basis for increasing gas production.

"CIL, ONGC, OIL already have got big mining areas with them and they may contribute maximum by extracting gas through coal gasification, CBM, shale gas etc at various locations. They may be allowed to extract gas on nomination basis immediately," he said.

According to him, these PSUs should focus more on increasing domestic production than expanding their footprints abroad to increase the economic growth and reduce outflow of foreign exchange from the country.

"The complete socio-economic scenario can be changed in 6-7 years if such blocks are nominated to above companies with time bound monitoring by a special cell for the purpose," he added.

In 2011-12, India's total oil import bill had leaped 40 per cent to a record $ 140 billion as high oil prices shaved off much of the nation's GDP growth rate.

As per government's estimates, a sustained $ 10 increase in oil prices lead to a 1.5 per cent reduction in the GDP of developing countries. In contrast, India's average cost of imported crude oil had risen by $ 27 per barrel in 2011-12.

The JD(U) chief also called for giving preference to power, fertiliser, steel, metal, petrochemical, CNG, commercial and domestic gas suppliers in allocating captive coal blocks.

There should also be a policy to enhance maximum possible initial capital outlay for exploration and exploitation of energy sources and incentives for identifying resources, purchase of technology and deployment of experts etc, he added.