Oil companies gain on gas pricing reform hopes

Fri Jan 4, 2013 12:31pm IST

Engineers of Oil and Natural Gas Corp (ONGC) work inside the Kalol oil field in Gujarat September 12, 2009. REUTERS/Amit Dave/Files

Engineers of Oil and Natural Gas Corp (ONGC) work inside the Kalol oil field in Gujarat September 12, 2009.

Credit: Reuters/Amit Dave/Files

Related Topics

Stocks

   

Reuters Market Eye - Shares in upstream oil and gas companies rally on hopes that a pricing formula, recommended by a government-appointed panel to look into oil and gas exploration contracts, will help sharply raise the prices of domestic natural gas.

The pricing formula, if approved by the government, could raise gas prices to around $8 per mmbtu (million metric British thermal units) by 2014/15 , brokerage Motilal Oswal estimated in a note dated on Thursday.

Motilal Oswal said Oil India Ltd, Oil and Natural Gas Corp Ltd, and Reliance Industries (RELI.NS) would be the biggest beneficiaries of the proposed formula, which involves volume-weighted international prices for gas producers.

While the government would take a final decision on the recommendations, our analysis indicates that domestic producers shall benefit from the proposed gas price formula, analysts at Motilal Oswal said.

ONGC shares are up 2.4 percent, while Oil India gains 3.1 percent. Reliance Industries is flat for the day.

(Reporting by Manoj Dharra)

FILED UNDER:
Comments (0)
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.

  • Most Popular
  • Most Shared

Jan Dhan Yojana

REUTERS SHOWCASE

Chance For Reform

Chance For Reform

India's coal crunch - a chance to revamp, reallocate and revive.  Full Article 

E-Commerce

E-Commerce

Ratan Tata invests in online retailer Snapdeal.  Full Article 

Top Priority

Top Priority

Finance minister says food inflation is top priority.  Full Article 

Deal Talk

Deal Talk

Who wants to buy Snapchat? Microsoft, Google, Apple, Alibaba.  Video 

Fresh Funding

Fresh Funding

Tiger Global leads $65 million funding in Indian messaging app Hike.  Full Article 

GDP Preview

GDP Preview

Economy likely grew faster in June quarter: Reuters poll.  Full Article 

Safety Net

Safety Net

SEBI revamps trading safety-net rules.  Full Article 

Fraud Investigation

Fraud Investigation

IMF's Lagarde put under investigation in French fraud case.  Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device.  Full Coverage