Shares of Gujarat State Petronet Limited (GSPL) surged over 3% to ₹298 in Monday’s trade after momentum built around the regulatory overhaul of gas transmission tariffs. The Petroleum and Natural Gas Regulatory Board (PNGRB) has initiated the process of amending the Natural Gas Pipeline Tariff Regulations, 2008, following suggestions and comments received from the Industry Committee. PNGRB has now sought stakeholder feedback on the proposed changes by April 11.
These amendments aim to introduce greater flexibility in cost pass-through and volume-based assumptions in tariff calculation, which could significantly benefit gas transmission players like GSPL and GAIL. The proposed changes, if implemented by June 2025, may lead to higher tariffs and improved financial metrics for such companies.
Separately, PNGRB has also approved GSPL’s proposal to lay the Anjar–Palanpur pipeline as part of its High Pressure Gujarat Gas Grid expansion. The 274-kilometre-long, 30-inch diameter pipeline will have a capacity of 12 MMSCMD and is expected to be completed in three years. The total project cost is pegged at ₹2,051.18 crore.
While the capital expenditure will not be included in future tariff calculations, it will be accounted for once the actual spending is verified. Upon completion, the expanded grid’s provisional capacity will increase to 44.76 MMSCMD, with final capacity determination subject to regulatory guidelines.
Brokerage CLSA considers the tariff reform process a positive structural development for gas transmission companies, with limited downside for downstream players.
