Natural gas producers continue to make losses as govt-dictated prices remain low: Icra – News 24-7 Live News 24-7 Live
Natural gas producers continue to make losses as govt-dictated prices remain low: Icra

Natural gas producers continue to make losses as govt-dictated prices remain low: Icra

Natural gas production remains a loss-making proposition for most fields for the Indian upstream producers as government-dictated gas price remains at its lowest level, rating agency Icra has said.

The domestic gas price notified at $1.79 per million British thermal unit for the six months beginning April 1 remains the lowest since the institution of the modified Rangarajan formula.

Additionally, the ceiling on price for gas produced from deep water, ultra deepwater, high temperature and high-pressure fields has also been announced at $3.62 per mmBtu for April-September 2021-22 which is 10.8 per cent lower than the price ceiling of $4.06 for October-March 2020-21 which would dampen the development of such projects.

“While this is unfavourable for domestic producers, it will benefit gas consumers. The consumers will also benefit in the long run from the expectations of continued supply overhang,” Icra said commenting on the gas price notified by the government earlier this week.

News Source: business-today

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