(ET)
In a big reform initiative, the government on Wednesday decided to put domestically produced gas under a standard price discovery mechanism to help scale up local production from fields of ONGC, OIL, Reliance and Vedanta and help create a uniform gas market. Accordingly, the Union Cabinet approved a standard e-bidding procedure for market-based price discovery of gas across various contractual regimes.
Petroleum Minister Dharmendra Pradhan said that under the new reform initiative, a standardised e-bidding mechanism will be suggested by upstream regulator Directorate General of Hydrocarbons (DGH) for transparent market-based discovery of gas price.
The regulator will also suggest a panel of e-bidding platforms to the producers. Gas producers will have a choice to opt for a platform and get the best market determined price for their gas. With the changes in gas pricing regime, government hopes that its objective of developing a gas-based economy will get the necessary push. Pradhan said the changes will also help increase domestic gas production by an additional 40 million standard cubic meters a day (mmscmd), from the current 84 mmscmd.
