The government has raised the ceiling price for natural gas produced from difficult fields to $9.89 per MMBtu for the six months starting October 1, 2026, up from $8.90 previously, according to a notification from the Petroleum Planning and Analysis Cell (PPAC).
The higher ceiling applies to gas from technically challenging offshore fields such as the Reliance Industries–BP operated KG-D6 block in the Krishna-Godavari basin, and will remain in force through March 31, 2027.
Legacy fields unchanged
For gas from legacy fields operated by ONGC and Oil India under the administered price mechanism (APM), the cap stays at $7 per MMBtu. The notified APM price for October works out to $11.22 per MMBtu, but producers will continue to realise only the capped $7 rate. Gas from new wells in ONGC and Oil India nomination blocks gets a 10 per cent premium over the APM price, taking it up to $7.70 per MMBtu.
Why it matters
Domestic gas pricing feeds directly into input costs for fertiliser manufacturers, power producers and city-gas distributors supplying CNG and PNG to households and transport. The higher ceiling improves the realisation for producers operating in deepwater and other difficult fields, where extraction costs are significantly higher than onshore or shallow-water blocks.
Sources: Business Standard
The higher ceiling applies to gas from technically challenging offshore fields such as the Reliance Industries–BP operated KG-D6 block in the Krishna-Godavari basin, and will remain in force through March 31, 2027.
Legacy fields unchanged
For gas from legacy fields operated by ONGC and Oil India under the administered price mechanism (APM), the cap stays at $7 per MMBtu. The notified APM price for October works out to $11.22 per MMBtu, but producers will continue to realise only the capped $7 rate. Gas from new wells in ONGC and Oil India nomination blocks gets a 10 per cent premium over the APM price, taking it up to $7.70 per MMBtu.
Why it matters
Domestic gas pricing feeds directly into input costs for fertiliser manufacturers, power producers and city-gas distributors supplying CNG and PNG to households and transport. The higher ceiling improves the realisation for producers operating in deepwater and other difficult fields, where extraction costs are significantly higher than onshore or shallow-water blocks.
Sources: Business Standard
