New Delhi: After a long wait, India finally launched its maiden India gas exchange on Monday, taking a step towards the deregulation of gas prices. The news comes as the government seeks to increase the share of natural gas in the country's energy mix to 15 percent by 2030. While launching the gas exchange, Union Minister for Petroleum and Natural Gas Dharmendra Pradhan said that the launch of the new electronic trading platform for natural gas by IEX (Indian Energy Exchange) has opened a new chapter in the energy history of India and help the nation move towards free-market pricing of natural gas.
Speaking at the virtual launch ceremony of India Gas Exchange, Pradhan said, "With this landmark, India is joining the club of progressive economies. As there will be a market-driven pricing mechanism, India Gas Exchange (IGX) will play a bigger role towards realizing a free market for gas."
The minister added that downstream regulatory PNGRB (Petroleum and Natural Gas Regulatory Board) will announce a new "pro-business" tariff policy for gas transport. "The government has no business to be in business and the consumer is the king in a free market. Trading of gas will ensure move towards a market-driven formula for the pricing of gas. PNGRB will soon notify tariff policy which will be important for transportation of gas," Pradhan said.
The Indian Gas Exchange will initially offer from a day to monthly trades from Dahej, Hazira Hub in Gujarat, and Kakinada in Andhra Pradesh.
The Indian gas market has multiple price bands for assets, including pre-NELP, NELP, High Temperature and High pressure (HTHP) and Deepwater and Ultra Deep Water blocks, in addition to the long-term contracted LNG price, the minister said.
The Indian Gas Exchange for natural gas is the biggest indicator of the Centre's progressive policy as it completes the entire energy value chain from gas production from multiple sources and imports of LNG from different parts of globe to having a transparent price mechanism, said Pradhan.
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