Natural gas to cost consumers $6.5 per unit in April

Natural Gas Prices: Under the new pricing formula, the central government has fixed the price of natural gas at $7.92 per mmbtu for the rest of the month of April. Rates for consumers have been capped at $6.5 per mmBtu.

The Petroleum Planning and Analysis Cell (PPAC) of the Petroleum Ministry said in its order that the price of natural gas for April 8 to April 30 will be US $ 7.92 per million British thermal units. This price has been fixed on the basis of 10 per cent of the average cost of imported crude oil.

The Union Cabinet, however, changed the pricing formula and capped the rates for consumers at $6.5 per mmBtu. This limit will be applicable for two years till March 31, 2025. The order said, the price for gas produced by ONGC, Oil India from their old fields will be subject to a ceiling of $6.5 per mmBtu. The new rates are about one-third less than the current rates. After this, it is believed that the prices of CNG and PNG will come down by up to 10 percent.

After this decision of PPAC, the price of CNG in Delhi will come down from Rs 79.56 per kg to Rs 73.59 per kg and PNG from Rs 53.59 per kg to Rs 47.59 per kg. In Mumbai, CNG will cost Rs 79 per kg instead of Rs 87 and PNG will cost Rs 49 per kg instead of Rs 54.

The cabinet has approved a base price of $4 per mmBtu for APM (Price Determination Mechanism) gas and approved a ceiling price of $6.5 per mmBtu. The changes in the gas pricing formula are based on the recommendations of a committee headed by Kirit Parikh. PPAC said in the order that from April 1 to April 7, the price of APM gas will be $ 9.16 per mmBtu. He told that the prices will be determined every month, while till now it was reviewed twice a year.

The notification states, the prices of APM will be declared by PPAC every month on the last day of the month. At the same time, the government will monitor the prices to ensure that the benefit of the reduction in the prices of CNG and PNG is passed on to the consumers.

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