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India Raises Deepwater Gas Price Ceiling to $9.89 per MMBtu
India has set a higher maximum price for gas from difficult-to-develop offshore fields.
The new limit is $9.89 for each MMBtu of gas, up from $8.90.
It applies for six months, from October 2026 to March 2027.
Gas from older fields run by ONGC and Oil India still has a $7 cap.
Some gas from new wells in those companies’ blocks can be priced up to $7.70.
The government says different rules apply to older fields and more challenging new discoveries.
Gas is used to make fertiliser, generate electricity and supply vehicles and homes.
The price limits can affect costs for these users.
The government raised the ceiling for gas from deepwater and other difficult fields to $9.89 per MMBtu from $8.90.
The new ceiling applies from October 1, 2026, through March 31, 2027.
The ceiling for gas from legacy ONGC and Oil India fields remains $7 per MMBtu.
October’s APM price for ONGC and Oil India gas is $11.22, but the actual price is capped at $7; eligible new-well gas can receive up to $7.70.
The price changes affect gas used by priority sectors including fertiliser, power and city gas distribution.
- Who
- The Indian government, through the Petroleum Planning and Analysis Cell, set the gas price ceilings.
- What
- It raised the ceiling for gas from deepwater and other difficult fields to $9.89 per MMBtu while keeping the legacy-field cap at $7.
- Where
- India, including deepwater fields such as the KG-D6 block in the Krishna-Godavari basin.
- When
- The new difficult-field ceiling applies from October 1, 2026, to March 31, 2027; the report was published October 4, 2026.
- Why
- The difficult-field pricing regime is intended to encourage investment in technically challenging gas resources; the higher new-well price is intended to encourage ONGC and Oil India to develop additional reserves.
Investment incentives
Price limits and users
Higher ceiling for difficult fields
Investment incentives
The higher ceiling could provide relief to producers developing technically challenging offshore resources and supports a regime intended to encourage investment.
Price limits and users
The government retains a ceiling on prices, and domestic gas price changes can affect input costs for fertiliser, power and city gas users.
Premium for new ONGC and Oil India wells
Investment incentives
The 10% premium, subject to the ceiling, is intended to encourage ONGC and Oil India to invest in additional reserves and new production.
Price limits and users
Gas from legacy fields remains capped at $7 per MMBtu, while the permitted new-well price can reach $7.70.
Key facts
- Deepwater and difficult-field ceiling
- $9.89 per MMBtu, increased from $8.90
- Effective period
- October 1, 2026–March 31, 2027
- Legacy-field ceiling
- $7 per MMBtu
- October APM price
- $11.22 per MMBtu, with the actual legacy-field price capped at $7
- New-well premium
- Up to 10% over the APM price, subject to the ceiling; up to $7.70 per MMBtu
- Difficult-field example
- The KG-D6 block, where Reliance Industries and BP produce gas
- Priority uses
- City gas distribution, fertiliser and power
Sources
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