Gas trading hub to be set up soon: Pradhan
India will soon set up a gas trading hub and have the price for domestically produced gas determined through this market, according to Minister for Petroleum and Natural Gas, Dharmendra Pradhan. Speaking at the KPMG ENRich 2018, Pradhan said, “We will soon be setting up a gas trading hub that will allow ease of access to gas suppliers and buyers. This will in turn help India develop its own hub-based pricing. “It is clear that we will be setting up a gas hub and we will move a Cabinet note on the same,” he added. At present, the price of domestically produced natural gas is fixed by the government through modified Rangarajan formula. The formula benchmarks the price prevalent in gas-surplus nations like US, Canada, UK, and Russia. The price for six month period beginning October 1, 2018 was fixed at $3.36 per million British thermal unit (mmBtu). This is 10 per cent higher than the price that was fixed for the preceding period. The Petroleum and Natural Gas Regulatory Board had appointed a consultant to develop a regulatory framework for the gas trading hub. PNGRB was targeting to launch the hub by December-end. Pradhan also said that there will be major investments in India’s energy sector over the coming decade. He said, “About $300 billion would be invested in coming decade. Asia’s biggest green oil refinery cum-petrochemical complex is being set up in Maharashtra at a cost of about $40 billion by oil marketing companies along with Saudi Aramco and ADNOC.” The Ratnagiri Refinery & Petrochemicals Ltd (RRPCL) had recently run into land acquisition hurdles. But officials aware of the developments are confident about commissioning the project as per the present timelines. The refinery is expected to be commissioned by 2025 and will produce Euro-VI and higher quality automotive and aviation fuels. This will be in addition to petrochemical products.