Government diverts gas from industry for CNG, PNG – Times of India

NEW DELHI: The oil ministry has ordered the diversion of natural gas from industries to the city gas distribution sector to cool CNG and piped cooking gas prices that have shot up by 70% on the use of imported fuel.
Less than three months after it ordered the use of costlier imported LNG to meet incremental demand for automobile fuel CNG and household kitchen gas PNG, the ministry on August 10 reverted to an old policy of primarily supplying domestically produced gas for city gas operations.
The allocation for city gas operators like Indraprastha Gas in Delhi and Mahanagar Gas of Mumbai has been increased from 17. 5 million standard cubic meters per day (mmscmd) to 20. 8 mmscmd, officials said. The increased allocation will meet 94% of the demand for CNG to automobiles and piped cooking gas to household kitchens in the country. Earlier, 83-84% of the demand was met and the remaining was met through the import of LNG by GAIL, they said.
Use of domestic gas instead of imported fuel will bring down the cost of raw material and ease CNG and PNG rates, officials said.
The move follows a massive jump in CNG and PNG prices in the country in the last one year as operators used costlier imported LNG. CNG prices in Delhi went up by a massive 74% (from Rs 43. 4 per kg in July 2021 to Rs 75. 6 per kg), while PNG prices rose by 70% (from Rs 29. 7 per standard cubic meter to Rs 50. 6 per scm).
Natural gas is the raw material used for CNG and PNG. This gas comes from fields such as Mumbai High and Bassein in the Arabian Sea. As the domestic production of gas is insufficient to meet all the requirements, the fuel is imported in the form of LNGin ships.