The government has cut the price of locally produced gas for October 2020-March 2021 by about a quarter to a multi-year low of $1.79 per million metric British thermal units (mmBtu), it said on Wednesday.
This would be the lowest price since 2014, when the country began linking local rates to a formula tied to global benchmarks, including Henry Hub, Alberta gas, NBP and Russian gas.
It also set the ceiling price for gas produced from more challenging fields at $4.06 per mmBtu for the same period, down 27.6 per cent from the prior six-month period, the statement showed.
The prices will be applicable on a gross heat value basis.
Lower natural gas prices mean reduced costs for gas for fertilisers, automobiles and households.
They will also cut earnings for state-owned Oil and Natural Gas Corp (ONGC) and Oil India.