Kirit Parikh committee is likely to recommend price cap recommend price caps for natural gas produced from legacy fields of state-owned firms to help moderate compressed natural gas (CNG) prices and piped cooking gas rates. Prices from legacy or old fields of Oil and Natural Gas Corporation (ONGC) and Oil India Ltd (OIL) where the cost has long been recovered and which are currently based on a formula that uses rates in gas-surplus nations. The committee is likely to recommend a floor or minimum base price and cap or ceiling rates ensuring that prices do not fall below cost of production.

Gas from legacy fields is sold to city gas distributors who had to raise rates of CNG and piped cooking gas. This rise in rates, which narrowed the gap between CNG and diesel, had prompted the review.

Gas from difficult fields such as those lying in deep sea or which are in high-pressure and temperature zones, the committee is likely to suggest not tinkering with the existing mechanism of paying them higher rates based on a different formula to compensate for the greater risk and cost involved

In order to review the formula that dictates the pricing of gas, the committee was constituted in September 2022.