Gujarat Gas announces reduction in gas prices

Cut aims to offer some respite to small and medium industries using piped natural gas as fuel

Having increased the  value added tax and cess on petrol and diesel fuel recently, the Gujarat government on Wednesday announced reduction in gas prices. Aimed at offering some respite to the small and medium industries that are using piped natural gas (PNG) as fuel, the reduction in gas prices by up to Rs 5 per cubic metre was announced by State Energy Minister Saurabh Patel. The PNG is supplied to small industries through state-run companies like Gujarat Gas Limited.

According to Gujarat government, the price reduction comes in the wake of fall in global prices of natural gas, impact of which was being passed on to the small and medium industries in the state. "The price cut will be made effective in two phases, the first will be from January 1, 2016 with reduction of Rs 3 per cubic meter, while additional Rs 2 per cubic meter price cut will be made effective from April 1, 2016,” Saurabh Patel stated in an official communique.

This will result into the direct benefit to the tune of Rs 625 crore per annum for the small industries in the state,"

With the state owned Gujarat Gas Limited (GGL) procuring gas through imported LNG, the new agreement signed between Ras Gas of Qatar and India's Petronet LNG Ltd. saw cost of imported LNG coming gone down, thereby resulting in cheaper procurement for companies like Gujarat Gas Limited, the minister informed.

Gujarat Gas Ltd's move to reduce gas prices would benefit the state owned company's more than 2,800 small and medium industrial customers in the state.