New Delhi : The government will “any day” announce a decision to allow market price for part of gas discoveries made in future from difficult fields, Oil Minister Dharmendra Pradhan said.
While approving a new gas pricing formula based on international hub rates in October last year, the government had decided that new gas discoveries in deep-water, ultra-deep sea or high-temperature and high-pressure fields will be given a premium over and above the approved price.
The ministry proposed to allow a fixed percentage of natural gas produced from difficult fields to be sold at market price via auctions and the remaining at the prevailing approved price for domestic gas.
Pradhan, who had recently met Finance Minister Arun Jaitley on the issue, said all issues are settled and an announcement can be made any day.
While the domestic gas is priced at $4.66 per million British thermal unit, the market price as measured by the rate at which the fuel is imported is $7-8. All gas producers, including Oil and Natural Gas Corporation (ONGC), have stated that it was uneconomical to produce gas from difficult fields at the current price of $4.66 per mmBtu.