Mahanagar Gas Limited (MGL) has notified the exchanges that the allocation of Administrative Price Mechanism (APM) natural gas to the company will be reduced by approximately 18% starting April 16, 2025. The revised allocation pertains to the Domestic PNG and CNG (Transport) segments, as per guidelines from the Ministry of Petroleum and Natural Gas dated August 10, 2022.
To compensate for the reduction, the shortfall is being met with New Well/Well Intervention Gas (NWG), which carries a higher cost compared to APM gas. As a result, the company stated that the shift in gas sourcing is expected to adversely impact its profitability.
MGL is currently assessing appropriate measures to mitigate the financial impact and ensure supply continuity to its consumers. The development is likely to influence cost structures, particularly in the absence of immediate tariff relief.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions. Author or Business Upturn is not liable for any losses arising from the use of this information.
