Cabinet may give green light to Kirit Parikh recommendations on natural gas
The Kirit Parikh committee, which was set up by the government to review the pricing formula for gas produced in the country has recommended complete liberalisation of natural gas prices by January 1, 2027.
- Apr 6, 2023,
- Updated Apr 6, 2023 4:46 PM IST
In what could be a significant development in India's oil and gas sector, the Cabinet Committee on Economic Affairs in its meeting today is likely to approve recommendations of the Kirit Parikh committee on Natural Gas, sources have told Business Today TV.
The Kirit Parikh committee, which was set up by the government to review the pricing formula for gas produced in the country, has recommended complete liberalisation of natural gas prices by January 1, 2027.
The government appointed panel which submitted its report in November last year had recommended a floor price and a cap for gas from legacy and old fields which make up two-thirds of all-natural gas produced in the country.
The government kept its gas price unchanged at $8.57 per mmBtu from April 2023, but if Kirit Parikh committee recommendations are accepted, the gas prices could see a downward revision which will be a positive for consumers and the producers, the source further added. Lower gas prices also imply lower subsidy burden on the government for the fertiliser sector.
The Petroleum and Natural Gas Regulatory Board (PNGRB) has amended regulations governing the tariff mechanism for natural gas transmission pipelines from April 1, 2023.
Under the new regulations, a uniform tariff of Rs 73.93 per metric million British thermal units (MMBtu) has been announced and the number of tariff zones has been increased to three from two.
In September last year the government announced that it has set a target to raise the share of natural gas in the energy mix to 15%, from 6.3 per cent currently, in 2030.
In what could be a significant development in India's oil and gas sector, the Cabinet Committee on Economic Affairs in its meeting today is likely to approve recommendations of the Kirit Parikh committee on Natural Gas, sources have told Business Today TV.
The Kirit Parikh committee, which was set up by the government to review the pricing formula for gas produced in the country, has recommended complete liberalisation of natural gas prices by January 1, 2027.
The government appointed panel which submitted its report in November last year had recommended a floor price and a cap for gas from legacy and old fields which make up two-thirds of all-natural gas produced in the country.
The government kept its gas price unchanged at $8.57 per mmBtu from April 2023, but if Kirit Parikh committee recommendations are accepted, the gas prices could see a downward revision which will be a positive for consumers and the producers, the source further added. Lower gas prices also imply lower subsidy burden on the government for the fertiliser sector.
The Petroleum and Natural Gas Regulatory Board (PNGRB) has amended regulations governing the tariff mechanism for natural gas transmission pipelines from April 1, 2023.
Under the new regulations, a uniform tariff of Rs 73.93 per metric million British thermal units (MMBtu) has been announced and the number of tariff zones has been increased to three from two.
In September last year the government announced that it has set a target to raise the share of natural gas in the energy mix to 15%, from 6.3 per cent currently, in 2030.