The Cabinet Committee on Economic Affairs on October 7, 2020 approved ‘Natural Gas Marketing Reforms’.
- 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.
- It will done 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.
- The policy has also permitted Affiliate companies to participate in the bidding process in view of the open, transparent and electronic bidding. This will facilitate and promote more competition in marketing of gas. However, rebidding will have to be done in case only affiliates participate, and there are no other bidders.
- The policy will also grant marketing freedom to the Field Development Plans (FDPs) of those Blocks in which Production Sharing Contracts already provide pricing freedom.
- The Open Acreage Licensing Policy (OALP) which is investor driven acreage auction process, has increased substantial acreages in the country.
- No blocks were allocated between 2010 and 2017 which has impacted the long term viability of the domestic production. Since 2017 more than 1.6 lakh sq.km area under 105 exploration blocks have been allocated. This will ensure sustainability of the domestic production in long run.
(Source: PIB)
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