Indraprastha Gas hikes CNG prices on rising input costs

Indraprastha Gas Ltd (IGL) has hiked CNG prices across India, including Delhi-NCR, with effect from December 17.

The company said the retail prices have been hiked due to increased input gas costs. With the latest hike, the CNG price in Delhi now stands at Rs 79.56 per kg, compared with Rs 78.61 per kg earlier.

Here's how the hike, with effect from 6 am on December 17, effects all regions serviced by IGL:

- The revised CNG price in Delhi is Rs 79.56/kg.

- The revised CNG price in Noida, Greater Noida and Ghaziabad is Rs 82.12/kg.

- The revised CNG price in Gurugram is Rs 87.89/kg.

- The revised CNG price in Rewari is Rs 89.57/kg.

- The revised CNG price in Karnal and Kaithal is Rs 88.22/kg.

- The revised CNG price in Muzzaffarnagar, Shamli and parts of Meerut is Rs 86.79/kg.

- The revised CNG price in Ajmer, Pali and Rajasamand is Rs 89.83/kg.

- The CNG retail price in Kanpur, Fatehpur and Hamirpur remains unchanged.

This is the 15th price hike since October. Earlier on October 8, IGL hiked prices of CNG and cooking gas piped to household kitchens in the national capital by Rs 3 each. The October CNG hike was the first hike in rates in over four months.

Natural gas, which is extracted from below earth's surface, is converted to compressed natural gas (CNG) for running automobiles and piped to household kitchens for cooking. It is also used to generate electricity and manufacture fertilizer. Global natural gas prices have surged due to geopolitical tensions.

IGL and MGL provide CNG as auto fuel and piped natural gas (PNG) to commercial establishments and households. Prices vary from city to city depending on the incidence of local taxes such as VAT.

Early in December brokerages said city gas distribution companies stand to benefit the most if the recommendations of the Kirit Parikh committee on gas pricing are implemented.

The committee, which submitted its report on November 30, suggested a floor price of $4 per metric million British thermal units (mmBtu) and a cap of $6.50 per mmBtu for gas produced from legacy and old domestic fields. The cap will rise by 50 cents every year, according to the recommendations, and pricing will be deregulated from January 2027.Pawan Kumar, commercial director of IGL, told CNBC-TV18 that if the panel’s recommendations are approved, it would be a welcome move. “The recommendation is that the input gas cost of APM (administered pricing mechanism) gas should come down by around 24 percent. But if we see the RLNG (regasified LNG) and spot component also for IGL, the net reduction (in overall costs) will be around 18 percent,” Kumar said.