Mahanagar Gas, IGL jumps up to 5% intraday after PNGRB tariff reform; check key details

Shares of city gas distributors (CGDs) are in the spotlight today after Petroleum and Natural Gas Regulatory Board (PNGRB) approved amendments to the Natural Gas Pipeline Tariff Regulations, 2025.

One of the key changes announced today was reduction of unified tariff zones from three to two, which aims to create fair pricing structure and streamline natural gas transportation across India.

Mahanagar Gas share price rose 5.2% intraday on NSE. As of 2:45 pm the stock trades 2.33% higher at ₹1,543 per share. Meanwhile, Indraprastha Gas shares rose 4.3% intraday to a day high of 229.00 per share on NSE.

As per new notification, the benefit of the lower unified tariff under Zone 1, which is up to 300 km from the gas source will now be extended nationwide to both Compressed Natural Gas (CNG) and Piped Natural Gas (PNG) segments, including for use in domestic households.

Natural gas distribution in India works through unified tariff zones, which a system where a single transportation tariff is applied to gas transported through the national gas grid, irrespective of the distance from the gas source.

PNGRB has earlier dividend the national gas grid into three tariff zones for the unified tariff regime and to reduce the impact of distance on gas prices.

• Zone 1: Up to 300 km from the gas source.
• Zone 2: From 300 km to 1200 km from the gas source.
• Zone 3: Beyond 1200 km from the gas source.

Another key reform announced today is that pipeline operators will now be required to procure at least 75% of their system-use gas through long-term contracts of three years or more. Besides this, operators with more than 75% pipeline utilisation will be required to allocate 50% of their post-tax earnings to infrastructure development, while the remaining 50% will be returned to consumers via tariff adjustments.