SF Prep Notes

Petroleum Ministry revises domestic gas allocation for CNG and PNG: advance allocation, pro-rata New Well Gas

The Petroleum Ministry said on 18 April 2025 that, from Q1 of FY 2025-26, domestic gas for CNG (transport) and PNG (domestic) will be allocated two quarters in advance, and New Well Gas will be allocated pro-rata instead of by auction.

Summary

The Ministry of Petroleum and Natural Gas announced changes to the Domestic Gas Allocation Policy on 18 April 2025 to keep CNG (transport) and PNG (domestic) gas available and affordable. From Q1 of FY 2025-26, allocations to these city gas distribution (CGD) segments will be made on a two-quarter advance basis and will include New Well Gas (NWG) from nomination fields of ONGC and OIL. Auction-based allocation of NWG has been replaced by quarterly pro-rata allocation by GAIL. Allocation ratios have been broadly maintained: 54.68% of projected demand in Q3 2024-25, 55.68% in Q1 2025-26 and a projected 54.74% in Q2 2025-26.

Key facts

Segments
CNG (transport) and PNG (domestic) under CGD
Advance allocation
Two quarters ahead, from Q1 FY 2025-26
New Well Gas
From ONGC/OIL nomination fields; auction replaced by quarterly pro-rata (GAIL)
Allocation ratio
54.68% (Q3 FY25), 55.68% (Q1 FY26), 54.74% projected (Q2 FY26)

Practice MCQs 2 questions

Q1 Advanced

Consider the following about the changes to the Domestic Gas Allocation Policy announced in April 2025: 1. Auction-based allocation of New Well Gas has been replaced with quarterly pro-rata allocation. 2. From Q1 of FY 2025-26, allocations for CNG (transport) and PNG (domestic) will be made on a two-quarter advance basis. Which of the statements given above is/are correct?

Show answer

Correct answer: C — Both 1 and 2

Both are correct, as per the Ministry of Petroleum and Natural Gas.

Q2 Advanced

What share of projected CGD demand for CNG (T) and PNG (D) was allocated domestic gas in Q1 of FY 2025-26, as per the Petroleum Ministry?

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Correct answer: B — 55.68%

55.68%; it was 54.68% in Q3 2024-25 and is projected at 54.74% for Q2 2025-26.

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