Mahanagar Gas Reduces CNG Rates by Rs2.50/kg in MMR; PNG Regulatory Board Asserts Control Over Distribution Monopoly

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Following the Petroleum and Natural Gas Regulatory Board (PNGRB)’s public notification of the end of its exclusivity period, Mahanagar Gas Ltd (MGL) has announced an INR 2.50/kg drop in compressed natural gas (CNG) rates for Mumbai and the Mumbai Metropolitan Region (MMR).

In an official release, MGL said, “The downward revision will come into effect from midnight of 5th and 6 March 2024. The new price of CNG will be INR 73.40 per kg. This new rate offers attractive savings of 53%, compared to petrol, and 22%, compared to diesel, at current price levels in Mumbai.”

According to the city gas distributor, this CNG price reduction will help to increase natural gas consumption in the transportation segment while providing consumers with unrivalled convenience, safety, reliability, and environmental friendliness, as well as contributing to India’s cleaner and greener future.

On Monday, PNGRB issued a public notice indicating that the infrastructure exclusivity period for MGL in Mumbai and the Greater Mumbai area concluded on April 11, 2021, and for Vadodara Gas Ltd in Vadodara on March 31, 2023.

According to rule 12 of the PNGRB city gas distribution (CGD) authorisation regulations, approved firms are granted an exclusivity period by PNGRB for laying, building, operating, or expanding city or local natural gas distribution networks at various times.

PNGRB further highlighted that it has not awarded Assam Gas Company Ltd or Tripura Natural Gas Company Ltd an infrastructure exclusivity term for the laying, constructing, or expansion of the CGD network in Upper Assam or Agartala.

The downstream regulator has stated that Mahanagar Gas Ltd (MGL) no longer holds a monopoly on Mumbai’s city gas networks. This may result in strong competition among petrol marketers for customers in the profitable metropolitan region, reducing MGL’s profit margins.