Oil companies to pay Rs 27 per litre for ethanol

New Delhi, July 27 (PTI) Oil companies will pay aninterim price of Rs 27 per litre for ethanol, which they willbuy from the sugar mills for doping in petrol, and a finalprice will be fixed after an expert committee submits itsreport। "This is an interim price that the EGoM has approved. Thefinal price will be dependent on the recommendations of anexpert committee appointed for the purpose," Oil Secretary SSunderashan said here today, when asked about the outcome ofof an Empowered Group of Ministers (EGoM) meet last evening. The EGoM had fixed the price at Rs 27 for a litre ofethanol in April this year as well. In October 2007, the Cabinet had made mandatory 5 percent ethanol blending across the country, with the exceptionof Jammu & Kashmir, North-East and island territories.However, the Petroleum Ministry had not been able to implementthe decision due to non-availability of the product. In March this year, the government had constituted theEGoM to resolve differences over mixing of ethanol in petrol.The Chemical Ministry was objecting to the use of ethanol forpetrol-blending, stating that the price of molasses they usefor manufacturing liquor has gone up. Both ethanol and alcohol are made from molasses, and thesugar industry had estimated a production of 160 crore litresin 2009-10. Potable liquor sector needs about 100 crore litres whilethe five per cent ethanol-blending programme would require 68crore litres. Besides, molasses are also required forindustrial purposes. The price increase was supposed to tempt producers tosell ethanol to oil firms, but the Chemical and FetiliserMinistry had protested by saying that the petrol-dopingprogramme will impinge upon the demand of potable liquorsector and chemical makers. The potable liquor sector and chemical producers are twoprimary consumers of molasses-based alcohol. It was statedthat the demand for the potable sector was increasing, andthere was no justification to increase the price of ethanol toRs 27 per litre. (पीटीआई)