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Government Hikes Price Of Domestic Natural Gas For September
The central government raised the price of domestic natural gas on Thursday to $8.60 per million metric British thermal units for September, from $7.85 per mmBtu in August.
The gas produced from the nomination fields of Oil and Natural Gas Corp. and Oil India Ltd. will have a ceiling of $6.50/mmBtu, according to a notification by the Petroleum Planning and Analysis Cell.
On April 8, the Ministry of Petroleum and Natural Gas linked the price of natural gas produced from legacy nomination fields of ONGC, OIL, and the New Exploration Licencing Policy blocks to the Indian crude basket. The price of natural gas from these fields was fixed at 10% of the monthly average of the Indian crude basket.
Earlier, the gas prices were reviewed every six months under the New Domestic Natural Gas Pricing Guidelines, 2014, which were based on volume-weighted prices prevailing at four global gas trading hubs. These guidelines have now been rationalised due to the significant time lag and high volatility in gas prices.
Gas produced by ONGC and OIL from their nomination blocks will be within the floor and ceiling prices, and gas produced from new wells or well interventions in the nomination fields of ONGC and OIL will be allowed a premium of 20% over the price under the administered price mechanism.
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