- The Cabinet Committee on Economic Affairs, chaired by the Prime Minister Shri Narendra Modi, has approved the revised domestic natural gas pricing guidelines for gas produced from nomination fields of ONGC/OIL, New Exploration Licensing Policy (NELP) blocks and pre-NELP blocks, where Production Sharing Contract (PSC) provides for Government’s approval of prices.
- The price of such natural gas shall be 10% of the monthly average of Indian Crude Basket and shall be notified on a monthly basis.
- For the gas produced by ONGC & OIL from their nomination blocks, the Administered Price Mechanism (APM) price shall be subject to a floor and a ceiling.
- Gas produced from new wells or well interventions in the nomination fields of ONGC & OIL, would be allowed a premium of 20% over the APM price. A detailed notification is being separately issued.
- The new guidelines are intended to ensure stable pricing regime for domestic gas consumers while at the same time providing adequate protection to producers from adverse market fluctuation with incentives for enhancing production.
- Natural gas produced from legacy or old fields will now be indexed to crude oil price, instead of pricing it based on gas prices in surplus nations such as the US, Canada and Russia.
- The Union Cabinet has approved the revised domestic natural gas pricing guidelines for gas produced from nomination fields of ONGC/OIL, New Exploration Licensing Policy (NELP) blocks and pre-NELP blocks, where production sharing contract provides for government’s approval of prices.
- The new guidelines are intended to ensure a stable pricing regime for domestic gas consumers while at the same time provide adequate protection to producers from adverse market fluctuation with incentives for enhancing production.
Cabinet Committee on Economic Affairs approves revised domestic gas pricing guidelines
