Govt cuts APM gas price for first time in 2 years
For the first time in two years, the government has reduced the price of natural gas used for producing CNG for vehicles and cooking gas, reflecting a decline in benchmark rates.
The price of natural gas from legacy fields allocated to state-owned
ONGC
without auction has been reduced from USD 6.75 to USD 6.41 per million British thermal units (mmBtu), according to a notification from the Oil Ministry's Petroleum Planning and Analysis Cell (PPAC).
The reduction, which is the first since the government in April 2023 implemented a new formula to price such gas, will aid city gas retailers like
Indraprastha Gas Ltd
,
Mahanagar Gas Ltd
and Adani-Total Gas Ltd who had been reeling under cost pressures from rise in input cost.
by Taboola
by Taboola
Sponsored Links
Sponsored Links
Promoted Links
Promoted Links
You May Like
Ortopedista: Si te duelen las rodillas, la espalda o las juntas, prueba esto
Alivio del dolor
Mirar Ahora
Undo
In April 2023, the Union Cabinet accepted an expert committee report to price on a monthly basis the gas from legacy fields, called APM gas, at 10 per cent of monthly average import price of crude oil with a floor of USD 4 and a cap of USD 6.5 per mmBtu. The cap price was to remain unchanged for two years and rise by USD 0.25 annually thereafter. In line with this, the cap rose to USD 6.75 per mmBtu in April.
In the first two years, the price of gas using this formula ranged between USD 7.29 per mmBtu and USD 9.12 but the cap ensured that the rate were fixed at USD 6.50 per mmBtu. In April, the price according to this formula came to USD 7.26 per mmBtu but the final rate was USD 6.75 in line with higher cap.
Live Events
In May, the price came to USD 6.93 but was capped to USD 6.75 for consumers.
Since there has been a fall in international oil prices in view of uncertain demand outlook, the Indian basket of crude oil averaged around USD 64 in May. Using this as a benchmark, the APM gas price came to USD 6.41 per mmBtu on gross calorific value (GCV) basis, according to PPAC.
"For gas produced by Oil and Natural Gas Corporation/Oil India Ltd from their nomination fields, the APM price shall also be USD 6.41 per mmBtu on GCV basis" for the period June 1, 2025 to June 30, 2025, PPAC said.
The fall in benchmark also means that the price of gas that
ONGC
produced from new wells in the APM fields would also come down.
The government had allowed ONGC to charge 12 per cent of the oil price for the gas coming from new wells it drills. The higher price was to make up for the capex incurred in drilling new wells.
As much as 5 million standard cubic meters per day of gas - or a 10th of all gas produced by ONGC - comes from new wells, according to industry sources.
APM gas is one produced by state-owned firms Oil and Natural Gas Corporation (ONGC) and
Oil India Ltd
(OIL) from fields that were given to them on nomination basis. This gas is the input that is used in the cooking gas piped to household kitchens as well as turned into CNG for running automobiles, making fertilizers and producing electricity.
Prior to April 2023, the price of gas produced from fields covered under the Administered Price Mechanism (APM) regime -- which accounts for 70 per cent of domestic gas production -- was determined semi-annually based on a formula that benchmarked it to average international prices at four gas trading hubs.
APM gas is provided to city gas distributors for supply to CNG and residential PNG segments, which together accounts for 60 per cent of their sales volume.
Subsequent to the April 2023 decision, APM gas prices are revised on a monthly basis but subject to ceiling and floor price. The ceiling price now is USD 6.75 per mmBtu and will rise by another USD 0.25 per mmBtu in April next year.
APM gas prices had seen wide fluctuations in the years running up to the April 2023 decision. From a low of USD 1.79 per mmBtu in 2021, to a high of USD 8.57 for the 6-month period ended March 2023.
The rate for difficult fields like KG-D6 of Reliance Industries has been set at USD 10.04 per mmBtu for six months beginning April 1 as compared to USD 10.16 in the preceding six months period, according to PPAC.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
NDTV
24 minutes ago
- NDTV
How Horses, Mules Helped In Navigating Steep Slopes To Build Chenab Bridge
Katra: To make the vision of "Kashmir to Kanyakumari" come alive, the project team behind the construction of the Chenab bridge faced several challenges. Among them was how to reach the location surrounded by the steep slopes of the Himalayas. The team had only one option -- horses and mules. According to Afcons Infrastructure Limited, the top infrastructure company that constructed the bridge, one of the main and earliest challenges was access to the bridge location, to transport equipment and construction materials. "Initially, mules and horses were used by the project team to reach the location. Slowly over a period, temporary roads were created and access was made available to the site," a spokesperson from the company said. Prime Minister Narendra Modi on Friday inaugurated the iconic Chenab Bridge, Anji Rail Bridge and Udhampur-Srinagar-Baramulla Rail Link (USBRL) project and flagged off Vande Bharat trains, connecting Kashmir to Kanyakumari. The spokesperson added that eventually on the North side of the river bank, an 11-km road was constructed and a 12-km long road on the South side. Krishnamurthy Subramanian, Executive Vice Chairman, Afcons, said the Chenab Railway Bridge is more than just a marvel of engineering. "It is a symbol of India's resolve to conquer the most formidable challenges with ingenuity and courage," Subramanian told PTI. The company used the world's tallest crossbar cable cranes and specialised heavy machinery as tools for this ambitious project. "The ancient and steep slopes of the Himalayas were tamed using massive consolidation grouting, making them sturdy for the colossal arch foundations," the company said, highlighting challenges it faced. "With the foundations set, the erection of the arch from both sides was planned by cantilever construction technique. The first big moment of triumph came on April 5, 2021, when a single majestic arch approaching steadily from both banks met at the crown," it added. "The viaduct construction was another unique challenge. There were multiple transition areas. Keeping this in mind, the launching sequence was meticulously planned in four sections," the spokesperson. Giridhar Rajagopalan, Deputy Managing Director, Afcons told PTI that for the first time in Indian Railways, incremental launching was done on transition curve and a longitudinal gradient, both occurring at same location, for the deck launching of the viaduct portion of the Chenab Bridge. S Paramasivan, Managing Director, Afcons, "For Afcons, it represents our unwavering commitment to nation-building and our ability to reimagine infrastructure in the toughest terrains. This bridge will inspire generations of engineers and stands as a tribute to the power of Indian engineering and teamwork." For the first time in the Indian Railways' history, a laboratory accredited by the National Accreditation Board for Testing and Calibration (NABL) was set up to ensure that quality was being monitored at every stage of the project. Situated at a height of 359 metres above the river, the Chenab bridge is 35 metres higher than the iconic Eiffel Tower in Paris and the world's highest railway bridge over the Chenab river. After inaugurating the Chenab bridge, the prime minister walked on it holding the Tricolour high. He travelled in a rail engine coach to reach the spot.
Time of India
25 minutes ago
- Time of India
Soon, mobile-friendly system to detect counterfeit notes
Ahmedabad: Over the years, Gujarat, and India as a whole, have seen several methods to pass off fake notes as real ones, with some even making a business out of it. Senior city police officials said Ahmedabad police's Special Operations Group (SOG) files cumulative cases periodically after seizing fake Indian currency notes (FICN) detected in the banking channels. "The highest denomination currency notes are often the most-used ones. After the discontinuation of bigger denominations, now Rs 500 is the biggest note, and thus the focus is on the note, along with the most circulated one – Rs 100. Notes of both the denominations have multiple security features that undergo scrutiny, and mostly the currency counting machine identifies the FICN," said a senior official. "Often, the material of the note and its security features also flag the forgery. " An identification system developed by researchers at the National Forensic Sciences University (NFSU) takes a different approach by using technology — it uses the serial number on the currency note to check with a central database to flag all the instances where a specific number has featured on the suspected FICN list. A team primarily from NFSU was granted an Indian patent for the method of identification. "The proposed system maintains a comprehensive historical database of scanned entities by users, ensuring consistent and scalable verification. Its real-time alerts notify users and authorities promptly, enhancing responsiveness. Designed to be mobile-friendly, rapid and cost-effective, the technology can help in sectors such as banking, retail, logistics and law enforcement," said a senior NFSU official. Sources said that govt agencies will now be approached for possible collaboration. Get the latest lifestyle updates on Times of India, along with Eid wishes , messages , and quotes !
Time of India
39 minutes ago
- Time of India
Mukesh Ambani announces 151cr endowment to his alma mater ICT
Mumbai: When Mukesh Ambani — India's richest man and chairman of Reliance Industries — returned to his alma mater, the Institute of Chemical Technology (ICT), he didn't just bring memories and his speech. He brought a tribute. A Rs 151-crore endowment, the largest in the institute's history, was announced on Friday. The occasion was the launch of Anita Patil's 'The Divine Scientist', a biography of Padma Vibhushan professor Man Mohan Sharma, described by many as the towering intellect who shaped Indian chemical engineering talent. When speaking of Guru Dakshina, Ambani announced the grant of Rs 151 crore to ICT, as per Sharma's instructions. "When he tells us something, we just told me, 'Mukesh, you have to do something big for ICT', and I am pleased to announce that for Prof Sharma," Ambani said, referring to the grant. "Most respected Prof Sharma," he addressed everyone, "my fellow Udcitians, coming to UDCT campus, I still call it that, has always felt like coming to a sacred temple. Prof Sharma, my warm respects to you as my most respected guru, my mentor, and my enduring source of inspiration." Praising Patil, he said: "It is a Herculean task to chronicle the life of a legend like Sharma." "I chose UDCT over IIT-Bombay," Ambani said, recalling the conviction of youth. That conviction was sealed when he attended Sharma's very first lecture. "I realised he is an alchemist, not of metals, but minds: he has the power to transform curiosity into knowledge, knowledge into commercial value, and both knowledge and commercial value into everlasting wisdom." Crediting the rise of the Indian chemical industry to Sharma's efforts, Ambani referred to him as a 'Rashtra Guru — a Guru of Bharat'. "He is our Yugpurush," said prof J B Joshi, former head of ICT. Not with reverence alone, but with the clarity of someone who saw how Sharma's life was distilled into a single principle: "Be a good teacher, do research at the frontier of knowledge, and use that for industry and society." Prof G D Yadav, former head at ICT, offered a staggering number — 1,300 PhDs trace their academic lineage to Sharma, directly or through those he mentored. "He is omniscient, omnipresent, omnipotent," said Yadav, invoking a title rarely uttered outside epics: "Bhramarishi." Get the latest lifestyle updates on Times of India, along with Eid wishes , messages , and quotes !
