Mahanagar Gas Ltd (MGL) said on January 31 that it has reduced prices of compressed natural gas (CNG) in Mumbai and adjoining regions, adding that the new rates will come into effect from February 1.
The price of CNG in Mumbai and adjoining regions has been slashed by Rs 2.50 per kilogram, MGL said in a press statement. With this reduction, the CNG price in the city and its neighbouring satellite towns will come down to Rs 87/kg.
The decision to slash the rates was taken in "anticipation of increased allocation of natural gas from High-Pressure-High Temperature (HTPT) areas to CGD (city gas distribution)," MGL said.
The increased allocation will "reduce Mahanagar Gas' input cost", the statement issued by the gas utility further noted.
"The revised MRP of CNG offers savings of around 44 percent compared to petrol at current price level in Mumbai," according to the gas distribution company.
The reduction in CNG prices comes nearly four months after MGL had increased it by Rs 6/kg in and around the megapolis.
The state-run company had then blamed the 40 percent increase in input prices by the government from October 1, along with a supply cut, as the reasons behind the steep hike.
Once struggling for natural gas, the country began experiencing an oversupply of gas in recent months as prices have shot through the roof.
The government had hiked the price of natural gas by 40 percent for the second half of the current financial year i.e. from October 2022 to March 2023.
The price of gas produced from old fields, which makes up for about two-thirds of all domestically-produced gas, was hiked to $8.57 per Metric Million British Thermal Unit (mmBtu) from $6.1 per mmBtu.
Similarly, natural gas produced from discoveries in deep and ultra-deep water and high-pressure, high-temperature areas was hiked to $12.46 per mmBtu from $9.92.