Natural gas prices, which are used to produce electricity, fertilizer, and CNG to fuel automobiles, hiked sharply by 40% on Friday to record highs in line with a global firming up of energy prices.
The price paid for gas generated from old fields, which
accounts for almost two-thirds of the country’s total gas production was increased from the previous USD 6.1 per million British thermal units to USD 8.57, according to an order from the oil ministry’s Petroleum Planning and Analysis Cell (PPAC).
The order stated that the price of gas from challenging and more recent fields, such as those in the deepsea D6 block in the KG basin, managed by Reliance Industries Ltd. and its partner bp plc, was increased to USD 12.6 per mmBtu from USD 9.92.
These are the highest pricing for managed/regulated fields and free-market areas, such as ONGC’s Bassein field off the coast of Mumbai (such as the KG basin).
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Additionally, since April 2019, rates have increased three times. This rise is a result of rising benchmark international prices.
Inputs such as gas are used to produce energy as well as fertilizer. Additionally, it is transformed into CNG and pumped into residential kitchens for use in cooking. Higher rates for CNG and piped natural gas (PNG), which have increased by over 70% in the last year, are likely to result from a sharp jump in pricing.
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