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Piped gas used for cooking and transportation will become costlier with the government hiking the price of domestically produced natural gas for the second half of the fiscal by 9.8 per cent.
The price for October 1, 2018 -March 31,2019 period will be $3.36 a unit (gas is measured in million British thermal units) up from $3.06/mBtu for the first half of the current fiscal.
The price for gas produced from Deepwater, Ultra Deepwater and High Pressure/ High temperature areas has also been revised to $7.67 a mBtu from $6.78 per mBtu during April-September period. The government revises the gas price price every six months.
This is the second steepest gas price hike since the implementation of the New Domestic Gas Policy, 2014. Every dollar increase in gas price would lead to an increase of about 50-55 paise a unit in electricity rates; for piped natural gas, the increase could be around ₹2.6 per SCM (standard cubic metre).
The domestically produced gas price is revised based on a formula benchmarked to ‘wellhead’ prices in four gas markets.
The hike in natural gas price will push up the cost of compressed natural gas (CNG) and piped natural gas (PNG).
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