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• The government has formally asked the petroleum regulator to determine marketing margins for natural gas on the basis of costs, rebuffing Reliance Industries, natural gaswhich had argued that the levy was purely a matter between buyers and sellers. The oil ministry has written to Reliance saying the Petroleum & Natural Gas Regulatory Board would determine the margin that gas suppliers can charge. "The board has now been entrusted the determination of quantum of marketing margin chargeable on sale of natural gas to end consumers by a marketing entity, on the basis of marketing costs incurred by it."

• Reliance Industries had earlier sent a letter to the ministry questioning the legality of the government's move to regulate marketing margins for KG-D6 gas and told the oil ministry that such a step would be discriminatory as state-run firms also used a similar levy to cover costs and risks. Oil ministry officials said that the rule would be applicable to "all marketers" of natural gas in the country including state-run Gail India. The decision was taken to protect consumers in the short-supplied market, government officials said.

• Until now, marketing margins were negotiated between buyers and sellers. While Reliance charged $0.135 per unit marketing margin for supplying its KG-D6 gas, Gail levied $0.17 per unit for supplying imported gas and gas supplied from the Panna-Mukta and Tapti fields. Gail also charges $0.11 per unit marketing margin on administered price mechanism (APM) gas, which was approved by the cabinet on May 31 last year. APM gas is produced from nominated fields operated by ONGC and Oil India, but Gail markets their output.

• According to industry executives, marketing efforts include supply management, contract negotiations, market tie-up, market surveys, dispute resolution, customer facilities, risk of take or pay, expenses in the form of bad debts, inventory carrying costs and maintaining administrative infrastructure all over the country.

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