Talks begin on lifting natural gas pricing restriction

NEW DELHI: The government has begun deliberations on lifting pricing restrictions on all locally-produced natural gas to ensure producers are able to trade their output on the proposed gas exchange, discover market price, and help build a mature domestic gas market, according to people familiar with the matter.

The oil ministry officials have begun discussing if and how the price restrictions can be lifted on the output from the fields given away to producers under the socalled nomination and NELP regime. Production from these fields, operated mainly by ONGC, Reliance IndustriesNSE 0.42 % and Oil IndiaNSE -0.07 %, makes up two-thirds of India’s total gas output and is priced according to the 2014 formula set by the government. Output from other producing fields such as Panna Mukta Tapti, Ravva, and Vedanta’s Barmer block already has pricing freedom.