Govt revises gas pricing formula; CNG, piped cooking gas to cost 10% less
New Delhi, Apr 6: The Union Cabinet on Thursday approved a revision in the formula for pricing of natural gas and imposed cap or ceiling price to help cut CNG and piped cooking gas prices by up to 10 per cent.
Natural gas produced from legacy or old fields, known as APM gas, will now be indexed to the price of imported crude oil instead of benchmarking it to gas prices in four surplus nations such as the US, Canada and Russia, Union I&B Miniser Anurag Thakur told reporters after a meeting of the Cabinet.
APM gas will be priced at 10 per cent of the price of basket of crude oil that India imports (Indian basket of crude oil). The rate such arrived at however will be capped at USD 6.5 per million British thermal unit. There will also be a floor or base price of USD 4 per mmBtu.
The ceiling price is lower than the current rate of USD 8.57 per mmBtu and would translate into a reduction in prices of piped cooking gas as well as CNG sold to automobiles, he said.
Piped cooking gas prices will be cut by up to 10 per cent across cities while CNG will see a little lower reduction, he said.
Rates of piped cooking gas, called PNG, and CNG have jumped 80 per cent in one year to August 2022. This follows a spurt in international energy prices.
Following the decision, the CNG price in Delhi will be cut from Rs 79.56 per kg to Rs 73.59 and that of PNG from Rs 53.59 per thousand cubic meters to Rs 47.59. In Mumbai, CNG will cost Rs 79 per kg instead of Rs 87 and PNG will cost Rs 49 per scm instead of Rs 54.
The Indian basket of crude oil is currently priced at USD 85 per barrel and 10 per cent of that translates into a price of USD 8.5 but the cap would mean the APM gas produces, ONGC and Oil India Ltd would get only USD 6.5 per mmBtu.
These caps and floor prices will be for two years and rates will increase by USD 0.25 per mmBtu per year thereafter, the minister said.
The changes in the gas pricing formula are based on the recommendations of a committee under Kirit Parikh.
While the committee's recommendation for floor and ceiling as well as indexation has been accepted, the one on annual increment and full deregulation has been changed.
The panel had suggested a 50 cents per mmBtu increase in the USD 6.50 ceiling every year to slowly move toward the marketing and pricing freedom for APM fields.
Asked about the deregulation, Oil Secretary Pankaj Jain said the decisions taken by the cabinet have been informed.
Also, rates will be fixed every month instead of the current practice of fixing them bi-annually.
Currently, the government bi-annually fixes prices of locally produced natural gas -- which is converted into CNG for use in automobiles, piped to household kitchens for cooking and used to generate electricity and make fertilisers.
Two different formulas govern rates paid for gas produced from legacy or old fields of national oil companies like Oil and Natural Gas Corporation (ONGC) and Oil India Ltd (OIL), and that for newer fields lying in difficult to tap areas such as deepsea.
The global spurt in energy prices post Russia's invasion of Ukraine has led to rates of locally produced gas climbing to record levels - USD 8.57 per million British thermal unit for gas from legacy or old fields and USD 12.46 per mmBtu for gas from difficult fields in six month period ending March 31.
At the April 1 revision, the APM gas price was kept on hold pending Cabinet approval for the change in the pricing formula. Had the old formula continued, prices of gas from legacy fields would have climbed to USD 10.7 per mmBtu.
The price of gas from difficult fields was cut to USD 12.11 per mmBtu.
The government had last year constituted a committee under Kirit Parikh to look at a revision in gas prices that balances both local consumer and producer interest, while at the same time advancing the country's cause of becoming a gas-based economy.
While leaving the formula for difficult fields unchanged, the panel suggested the price band for current production from legacy or old fields, which make up for two-thirds of all gas produced in the country and is currently under the administered price mechanism, or APM, until a full deregulation of prices is implemented in 2027.
The panel suggested a 50 cents per mmBtu increase in the USD 6.50 ceiling every year to slowly move toward the marketing and pricing freedom for APM fields.
Thakur said the ceiling price covers for the cost of production of producers while protecting consumers particularly CNG users, kitchens using piped cooking gas and fertilizer plants who had grappled with soaring input cost.
APM gas makes up for most of CNG and kitchen gas supplies.
India aspires to become a gas-based economy with the share of natural gas in its primary energy mix targeted to rise to 15 per cent by 2030 from the existing level of around 6.3 per cent.
APM gas fields were allotted to ONGC and OIL before 1999. Production from these fields do not attract profit-sharing with the government, and their pricing formula is benchmarked to gas prices at international gas hubs in surplus nations every six months based on the weighted average price. Prices were last revised on October 1 and are now due for revision on April 1.
To incentivize additional production from a new well or well intervention in the nomination blocks, the Kirit Parikh committee recommended a premium of 20 per cent over and above the APM prices for ONGC and OIL till complete freedom. This has been approved by the Cabinet, he said.
As much as 34 per cent of APM gas is allotted to the power sector in 2021-22, 17 per cent to the fertilizer industry, which impacts food prices, and 22 per cent to the city gas sector.
The committee also recommended that gas should be brought under the Goods and Services Tax, or GST, regime. Having a common taxation such as GST for gas in lieu of state level VATs, which vary from 3 per cent to as high as 24 per cent, will help develop the market.
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Media dinner shooting suspect wrote about targeting of administration officials, Trump says
Washington (AP): The man accused of trying to storm the ballroom at the White House Correspondents' Association dinner with guns and knives had written about targeting Trump administration officials, and his family raised concerns with law enforcement before the event, President Donald Trump said Sunday in an interview on Fox News Channel.
The accused gunman's family had alerted police in Connecticut, Trump said, revealing new details about a chaotic encounter that disrupted one of Washington's glitziest annual events the night before.
The suspect, identified by law enforcement officials as 31-year-old Cole Tomas Allen of Torrance, California, was expected to face criminal charges on Monday from the Justice Department, whose acting leader, Todd Blanche, said the suspect travelled by train from California and checked in as a guest days earlier at the Washington hotel where the Saturday night gala dinner was held with its typically tight security.
Law enforcement officials who have interviewed Allen's relatives, examined the gunman's electronic devices and his writings preliminarily believe he intended to target administration members in attendance at the dinner.
He attempted to charge into the cavernous ballroom at the Washington Hilton but was tackled to the ground in a violent scene that resulted in shots being fired, Trump being hurried off the stage and guests ducking for cover beneath their tables.
“It does appear that he did in fact set out to target folks who work in the administration, likely including the president,” Blanche told NBC's “Meet the Press.”
The suspect is believed to have purchased the two firearms he carried within the last couple of years, Blanche said. He is not being cooperative and is expected to face multiple charges on Monday.
Video posted by Trump showed the suspect running past security barricades as Secret Service agents ran toward him. One officer was shot in a bullet-resistant vest but was recovering, officials said. The gunman was taken into custody and was not injured, but was being evaluated at a hospital, police said.
“He failed,” Blanche said on CBS's “Face the Nation.” “Law enforcement did their jobs.”
Authorities believe the suspect fired the shot that hit the Secret Service officer, who is expected to make a full recovery, Blanche said.
“He's going to be great, he's going to be fine, and thank God he was wearing a bulletproof vest,” Blanche said Sunday on ABC's “This Week.”
Social media posts that appear to match the suspect show he is a highly educated tutor and amateur video game developer.
A May 2025 profile photo of Allen appears to match the appearance of the man in a photo of the alleged attacker being taken into custody that was posted Saturday night by Trump.
The photo, posted to the social networking site LinkedIn, shows him in a cap and gown after graduating with a master's degree in computer science from California State University, Dominguez Hills.
Allen earned a bachelor's degree in 2017 in mechanical engineering from the California Institute of Technology in Pasadena. He listed his involvement there in a Christian student fellowship and a campus group that battled with Nerf guns.
The shooting at the security barricades happened minutes after the event got underway.
The Secret Service and other authorities swarmed the room as guests ducked under tables by the hundreds. Gasps echoed through the ballroom as guests realised something was happening. Hundreds of journalists immediately got on phones to call in information.
“Out of the way, sir!” someone yelled. Others yelled to duck. From one corner, a “God Bless America” chant began as the president was escorted offstage. Outside the hotel, members of the National Guard and other authorities flooded the area as helicopters circled overhead.
After an initial attempt to resume the event, it was scrapped for the night and will be rescheduled.
Trump was unusually conciliatory after what he saw as a third attempt on his life in less than two years. He suggested that his personal politics had made him a repeated target, but he also called for unity and bipartisan healing in an increasingly violent world.
“It's always shocking when something like this happens. Happened to me, a little bit. And that never changes,” Trump told reporters in a hastily organised news conference at the White House late Saturday.
