Strongly refuting allegations of favouring Reliance Industries, Oil Minister M Veerappa Moily today said the proposed revision in natural gas price will apply to all companies including state-owned ONGC.

Moily thrashed CPI MP Gurudas Dasgupta's allegations of favouring RIL as "totally false and baseless" and said the proposed increase in natural gas price was being done "strictly in line with the formula proposed by Prime Minister appointed panel headed by his economic adviser C Rangarajan."

"It is totally false and baseless. The new pricing, if approved by the Cabinet Committee on Economic Affairs (CCEA), will apply to all gas produced in the country.

Two-thirds of the gas produced in the country is by public sector companies (like ONGC) and the new pricing will apply equally to them and they stand to benefit more out of it," he said.

In a point-by-point rebuttal to allegations made by Dasgupta at a press conference yesterday, Moily said the CPI leader "was wrong in saying that the petroleum ministry has deviated from the recommendations of Rangarajan Committee."

The allegations of a gigantic scam in making "are not only devoid of merits but also are malicious and based on distorted facts".

The price revision besides being contractual requirement, was needed to spur investment in oil and gas exploration which has stagnated over past few years, he said.

Gas finds in deep-sea are not economically viable to develop at current rate of USD 4.2 per million British thermal unit.

"Mr Dasgupta talks of fertiliser subsidy rising due to gas price increase but what he does not realise is that if domestic production does not increase, we will have to import gas and imported gas (LNG) costs triple the domestic gas price," Moily said.

The government stands to gain from rise in domestic gas price by way of increased royalty, profit petroleum as well as taxes which can be used to make up for increased subsidy.

Moily was attending an oil and gas conference in Bangkok when Dasgupta made the allegations at a press conference yesterday at New Delhi.

The panel has been asked to suggest "utilisation of Oil Industry Development Board (OIDB) cess and other innovative resource mobilisation approaches for appraising the unexplored /partly explored acreages and development and promotion of Indigenous service industry in E & P sector."

It would also review institutional mechanism for acquisition of oil and gas assets abroad as well as pursuing diplomatic and political initiatives for import of gas from neighbouring and other countries with emphasis on transnational gas pipelines.

Besides, steps to be taken for ensuring adequacy of finances for R&D required for building knowledge infrastructure in E&P activities and steps to be taken for development of gas transportation infrastructure for establishing countrywide marketplace are also included in its terms of reference