The Narendra Modi government has hiked the natural gas price by 10% in its six-monthly revision to $3.36 per million British thermal unit (mmBtu) from $3.06 from October 1, which will lead to higher CNG and PNG rates, while benefiting upstream oil and gas exploration companies like ONGC, Oil India and Reliance Industries, Care Ratings said in a report.
The 10% hike, however, is less than 14%-15% anticipated earlier. The government revises natural gas price every six months based on the average rate in gas-surplus nations like Russia, the United States and Canada. The revised gas price of $3.36 per mmBtu will be applicable till March 31, 2019.
“Upstream oil and gas exploration companies like ONGC, Oil India and Reliance Industries will benefit as higher gas prices will lead to higher earnings, due to improvement in per unit realisations in the natural gas segment, Care Ratings said in a report. Read More