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The government is planning to increase the price of natural gas supplied for city transportation and to small industry.
While the price of compressed natural gas is planned to be linked to diesel prices, the price of gas for the small-scale sector would be progressively increased to reflect market prices.
CNG prices in Delhi are about 48 per cent less than diesel prices and about 31 per cent of petrol prices. According to a proposal drawn by the petroleum and natural gas ministry, CNG prices should be linked to diesel prices and pegged at about 15-20 per cent less than diesel prices.
Small consumers in Agra and Ferozabad are supplied natural gas as per the Supreme Court order. Besides, there are small consumers having individual allocations of less than 0.05 million standard cubic metre a day in other regions.
The ministry has proposed that CNG prices may be increased in a phased manner over a period of three to five years.
Under a Supreme Court ruling, the transport sector was to be given priority in supply of natural gas produced out of fields under the administered pricing mechanism.
After meeting the requirement of gas for the transport sector in Delhi and other air-polluted cities in India, the balance gas was to be supplied to industries, with preference given to public sector undertakings and power projects.
According to the ministry, there is no Supreme Court directive regarding the price at which natural gas has to be supplied to the transport sector and small industry.
Out of a total of 55 mmscmd gas produced by Oil and Natural Gas Corporation, 6 mmscmd is supplied to consumers covered under the court order and other small-scale consumers.
Gas facts
