The government has increased the price of gas to oil producers and regular fields from $ 2.9 per mmBtu to a record $ 6.10 per unit with effect from April 1. The price has been increased by 62 per cent to $9.92 per mmBtu for gas from Reliance’s hard-to-excavate deep-sea areas.
ONGC accounts for 58 per cent of its domestic gas production and a change in gas prices of even $1 per mmBtu can change its earnings by five-eight per cent. According to a Morgan Stanley report, “ONGC’s annual income is expected to grow by up to $3 billion in FY 2022-23. Apart from this, ONGC’s return on capital is also going to be above 20 per cent after a decade.
Gas prices from deep sea areas and difficult gas producing areas with heavy pressure and high temperature also increased by $ 3.8 per mmBtu to $ 9.9. These increased rates will also be applicable on gas originating from ONGC’s KG-DWN-98/2 field.
Gas production from Reliance’s deep-sea KG-D6 block has reached a level of 18 million cubic meters per day and is expected to reach 27 million cubic meters per day by March 2024. The report has estimated that the increase in gas prices will increase Reliance’s annual income by $ 1.5 billion.
Along with this, Morgan Stanley has also predicted another 25 percent increase in gas prices during the next review expected in October 2022. This is because four global benchmark gas prices could remain bullish due to short supply. India determines the domestic gas price on the basis of the price of gas in the last 12 months at the four global gas hubs NBP, Henry Hub, Alberta and Russia Gas.
LPG Price Hike: Commercial cylinders became costlier by Rs 250 in one stroke, CNG-PNG rates also increased in UP
Source: navbharattimes.indiatimes.com
: Language Inputs
This post is sourced from newspapers, magazines and third-party websites. For more information please check NewsDay Express Disclaimer.