(MC)
India plans to bring more reforms in a natural gas sector and will build a gas trading hub to aid better price discovery for domestic as well as imported fuel, said Oil Minister Dharmendra Pradhan. Also, the country plans to double the network of pipelines transporting natural gas to 30,000 km in next 3-4 years as part of plans to shift to a gas-based economy to cut greenhouse emissions and reliance on imported oil.
“We are in the process of reforming the gas market in India where you can sell your gas through a gas trading hub,” he said at an India Session at the 22nd World Petroleum Congress in Istanbul. Currently, natural gas in India is sold on the basis of a government-mandated formula that links the local price to rates prevailing in gas-surplus nations.
In comparison, most long-term contracts for import of gas are linked or indexed to oil. The absence of market determined prices have been a big disincentive for companies to invest in gas exploration and production.
