Shares of gas distribution companies rallied as much as 10 per cent after reports suggested Qatar-based RasGas is ready to modify sale and purchase agreement with Petronet LNG.
Reports suggested that RasGas' long term contract with Petronet is now linked at three months of brent instead of the earlier 12 months which will enable cost of gas to drop below USD 7 per mmbtu from USD 12.5 per mmbtu.
Shares of Gail Ltd were the top gainer of benchmark BSE Sensex with its stocks settling for the day at Rs 348.80, after surging 10.07 per cent.
Among other companies, shares of Petronet LNG rose 6.79 per cent to close at Rs 220.10, while Gujarat Gas went up 6.03 per cent to close at Rs 514.
Delhi-based Indraprastha Gas closed at Rs 482 after going up 3.85 per cent.
The surge may have also been triggered by the new draft hydrocarbon policy announced earlier this week.
The Oil Ministry this week issued a paper on new fiscal and contractual regime for award of hydrocarbon acreages with a view to revive investor interest in oil and gas exploration by simplifying rules.
It proposed to free natural gas pricing as well as replace the controversial Production Sharing Contract (PSC) with simpler revenue-sharing regime for all future field auctions in the backdrop of low gas prices not attracting investors in exploration and production sector.
Mumbai-based Mahanagar Gas Ltd (MGL) also filed draft IPO papers with market regulator Sebi earlier this week.
According to analysts, the steady surge in share prices of Gail throughout the week can also be attributed to this as the company through the IPO will offload up to 12,347,250 shares of MGL, while British Gas Asia Pacific Holdings also intends to sell an equal number of shares.
GAIL and BG Asia Pacific are promoters of MGL.
