Petroleum Minister Ram Naik on Sunday said his department was waiting for the ministries of law and divestment to prepare a note on the divestment of Hindustan Petroleum Corporation and Bharat Petroleum Corporation in the wake of the Supreme Court order and he will abide by the Cabinet decision on the issue.

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He said the law ministry and the divestment ministry are looking into the issue.

"Both these ministries will prepare a note on the matter, which will then come up for discussion again at the Cabinet Committee for Divestment," Naik said.

Asked if he will abide by the CCD decision again or take a different stand on the issue, the minister said, "Yes, I will abide by what the CCD decides."

Asked if he was against privatisation of these two companies, the minister reiterated that he will go by what the cabinet decides.

On the issue of LNG pricing, Ram Naik said it will differ from customer to customer, but LNG will definitely be a cheaper fuel than naphtha or diesel.

On the LNG policy, Naik said the policy draft has been submitted to the Cabinet, but since more than one ministries are involved in the decision-making, it is yet to be finalised.

"Several ministries have raised issues. All these are being worked out," he said without elaborating.

On the Gas Act, Naik said the government is waiting for the opinion of the Supreme Court on the matter.

"It is not just the Centre and Gujarat that is involved. Other states too are involved," he said.

"I would, however, prefer if the pricing comes under the same regime as the central sales tax of four per cent," he said to a question on the tax that the state government can levy.

"This ought to be seen in the context of natural gas being grossly short of supply and units having to resort to naphtha or diesel to meet their fuel needs," the minister said.

He said under the new exploration policy of the government, the bidder will have the freedom to decide the commercial selling price.

"There will be no government control on the price and there will be little that the government can do when consumers demand cheap LNG," he said.

While the LNG terminal at Dahej, being promoted by Petronet, is set to achieve mechanical completion by December 2003 and will be operational by January 2004, the LNG terminal at Hazira, promoted by Shell group of companies, is set to be completed by the third quarter of next year and will be operational by the fourth quarter, he said.

The government is currently installing a gas grid and aims to provide LNG as a feasible fuel to industries.