Kirit Parikh Committee for Reviewing of Gas Price Formula

• 15 Sep 2022

The Ministry of Petroleum and Natural Gas has set up a committee under noted energy expert Kirit Parikh to review the current gas pricing formula for domestically-produced gas to ensure “a fair price to the end consumer”.

Reason for the Revision

• Amid rising concerns over skyrocketing global natural gas prices jacking up energy and industrial costs, and derailing the efforts to contain inflation.

Possible Outcome

• The next price revision is likely lead to a further rise in prices of gas from both the normal and the “difficult” fields, given that the benchmark global prices have remained elevated.
• Though the committee has been asked to submit the report by the end of this month, its inputs won’t be used for the next six-monthly revision of the domestic gas prices for the October 2022-March 2023 period.

Last Revision

• In the last revision effective April 1, 2022, the price of natural gas from old and regulated fields was doubled to $6.1 per million British thermal unit (mBtu).
• Price of gas produced from difficult fields like KG-D6 block operated by Reliance Industries-bp combine, was hiked from $6.13 earlier to 9.92/mBtu for the April-September 2022 period.