(The Gist of PIB) Cabinet approves ‘Natural Gas Marketing Reforms’

(THE GIST OF PIB) Cabinet approves ‘Natural Gas Marketing Reforms’


Cabinet approves ‘Natural Gas Marketing Reforms’

  • The Cabinet Committee on Economic Affairs chaired by the Prime Minister Shri Narendra Modi has approved ‘Natural Gas Marketing Reforms’, taking another significant step to move towards gas based economy. 


  • The objective of the policy is to prescribe standard procedure to discover market price of gas to be sold in the market by gas producers, through a transparent and competitive process, permit Affiliates to participate in bidding process for sale of gas and allow marketing freedom to certain Field Development Plans (FDPs) where Production Sharing Contracts already provide pricing freedom.

Key highlights:

  • Standard procedure to discover market price of gas to be sold in the market by gas producers. Director General of Hydrocarbon will suggest an e-bidding platform to provide a transparent and competitive method of discovering market prices.
  • Permit for the Affiliate Companies (associated gas companies and not producers) to participate in bidding process. This will kindle competition in the gas market.
  • Complete marketing and pricing freedom to domestic gas production companies that discovered and developed field plans after February 2019. Last year, Government declared that new gas discoveries will get pricing and marketing freedom.
  • Reforms are aimed at giving a boost to the gas economy and reducing import dependence.
  • Gas comprises about 6.2% of India's primary energy mix (global average is 24%). The government plans to increase this share to 15% by 2030.
  • India currently produces 84 million standard cubic meters a day (mmscmd) of natural gas and imports around the same. Reforms are expected to increase domestic gas production by an additional 40 mmscmd.



Study Material for UPSC General Studies Pre Cum Mains

Get The Gist 1 Year Subscription Online

Click Here to Download More Free Sample Material

<<Go Back To Main Page

Courtesy: PIB