Cabinet okays uniform marketing margin for domestic gas supply to urea, LPG producers

Our Bureau New Delhi | Updated on January 22, 2018 Published on November 18, 2015


The Cabinet has given its approval for a uniform marketing margin for supply of domestic gas to urea and LPG producers.


“This decision is a structural reform…With this decision, there would be uniformity in the marketing margin on domestic gas charged by gas marketers for regulated sectors namely urea and LPG,” the Government said in an official statement on Wednesday.


The statement added that this would result in a reduction of the marketing margin paid by urea and LPG producers.


Marketing margin is a charge levied by gas marketing companies on its consumers over and above the cost or basic price of gas for taking on the additional risk and cost associated with marketing gas. At present different transporters are charging different margins for supply of natural gas.


The rate would be fixed on a non-discretionary basis by the Petroleum and Natural Gas Regulatory Board. Further escalations up to the Wholesale Price Index would be decided by the Ministry for Petroleum and Natural Gas.


“The issue of vast disparity in marketing margins was looked into by the PNGRB. This decision is likely to enhance transparency and provide an element of certainty for future investments in the gas infrastructure sector,” the statement said. 

Published on November 18, 2015
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