Page 59 - Policy Economic Report -August 2026

POLICY AND ECONOMIC
OIL & GAS MARKET

GOBARdhan now takes this progress to the next level. Administered by the Ministry of Petroleum and
Natural Gas, the Scheme creates one integrated platform across the entire CBG value chain. This will
enable faster implementation, stronger project economics and greater certainty for investors, lenders
and developers.

A Strategic Opportunity for India:

India’s demand for natural gas is expanding across transport, households, industry and commercial
sectors. CBG can meet a growing share of this demand through domestic renewable production,
strengthening energy resilience and reducing dependence on imported fossil fuels.

CBG is chemically equivalent to natural gas and can be seamlessly integrated into the existing gas
ecosystem. It therefore combines the benefits of a renewable fuel with the reach and utility of India’s
expanding gas infrastructure.

Each CBG plant also creates a local circular economy around agricultural residue, cattle dung and
other organic resources. It generates opportunities in feedstock supply, transportation, plant
operations and organic manure production, while supporting cleaner waste management and lower
greenhouse gas emissions.

Six Growth Engines under GOBARdhan

Component 1: Assured CBG Offtake
GOBARdhan establishes a dedicated CBG Offtake Assurance framework to provide a reliable and
predictable market for producers. Procurement by City Gas Distribution entities will support
achievement of the notified CBG Obligation trajectory of 3% in FY 2026-27, 4% in FY 2027-28 and 5%
from FY 2028-29 onwards in the CNG (Transport) and PNG (Domestic) segments.

The framework converts the blending obligation into a clear, long-term demand signal for the
industry. Consistent implementation across CGD networks will improve project bankability, support
capacity utilization and encourage long-term private investment.

Component 2: Stable CBG Pricing Framework
GOBARdhan introduces a stable administered CBG price of Rs.2,110 per Metric Million British Thermal
Unit (MMBTU), supported through a government-backed pricing framework. The framework provides
long-term revenue visibility while protecting consumer affordability through a combination of
Government support and a market-based cost-sharing mechanism.

With a minimum ten-year horizon, the pricing framework will provide producers with durable revenue
certainty, commercially attractive returns and a stronger business case for investment and capacity
expansion.

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