As of midnight, on April 8, Adani Total Gas Limited (ATGL) has implemented a price reduction for Compressed Natural Gas (CNG) by Rs 8.13 per kilogram and Petroleum Natural Gas (PNG) by Rs 5.06 per standard cubic meter (scm).
This price revision follows the approval of new guidelines on gas pricing by the Union Cabinet on Thursday i.e April 06. The new guidelines pave the way for linking natural gas prices in India to global crude prices.
ATGL has issued a statement expressing its appreciation for the Indian government's decision to link the Administered Price Mechanism (APM) Price of gas supply for Compressed Natural Gas (CNG) vehicles and residential households to 10% of the Indian crude basket, with a minimum rate of $4 and a maximum rate of $6.5 per million metric British thermal unit (MMBTU).
According to the statement released by ATGL, the company has decided to prioritize its end consumers by passing on the benefits of the recently announced New Gas Pricing guidelines by the Government of India to a vast number of Home PNG and CNG consumers.
This move will enhance the affordability of PNG and CNG, resulting in savings of more than 40% for CNG consumers compared to petrol prices and approximately 15% for Home PNG consumers compared to LPG prices.
After the Cabinet meeting, Union Minister Anurag Thakur briefed reporters that the pricing of natural gas produced from old or legacy fields, also known as APM gas, will now be linked to crude oil prices rather than being based on gas prices in surplus countries such as the US, Canada, and Russia.
He further added that the rates will be determined on a monthly basis, instead of the current bi-annual revision.
On Friday, Mahanagar Gas, a subsidiary of Gail India, also announced a reduction in the retail price of CNG by Rs 8 per kilogram and domestic PNG by Rs 5 per standard cubic meter (scm) in its licensed area.