The committee on suggesting fair price of natural gas to the end-consumer, chaired by former Planning Commission member Kirit Parikh, will submit its report to the Ministry of Petroleum & Natural Gas (MoPNG) on Wednesday.

The committee, which includes officials from ONGC, IOC, OIL and GAIL, private city gas distribution (CGD) operators, industry association, and the Fertiliser Ministry, has suggested a floor price of $4 per million British thermal units (mBtu) and a ceiling price of $6.5 for natural gas from legacy fields, sources said.

The committee has kept unchanged the pricing formula for determining the price of gas produced from discoveries from Deepwater, Ultra Deepwater and High Pressure-High Temperature (HPHT) fields. “The floor price is the point below which producing natural gas from the legacy fields will not be financially viable for ONGC and OIL, while the ceiling price is the point beyond which gas will be costly for the households. The committee is favouring a mechanism to shield the citizens from high volatility in gas prices as has been witnessed in the past one year,” said one of the sources.

India meets half of its natural gas requirement through domestic production, while the other half is imported as liquified natural gas (LNG).

The committee has emphasised that pricing policy should reflect the interest of the country. For instance, gas is crucial for sectors such as CGD and fertilisers on which India’s food security depends.

Last month, the government revised the price of gas upwards by 40 per cent to $8.57 per mBtu for the second half of FY23. The gas price ceiling for gas from challenging fields was revised upwards by around 25 per cent to $12.46 per mBtu.