The government will now allocate natural gas to CNG and piped cooking gas retailers two quarters in advance to give city gas companies greater clarity, the Oil Ministry said Friday.

With city gas retailers like Indraprastha Gas Ltd, Mahanagar Gas Ltd and Adani-Total Gas Ltd reporting pressures on margins after the allocation of cheaper administered price or APM gas to them was cut without giving enough advance notice, the ministry decided to tweak the allocation policy.

"From Q1 (first quarter) of FY 2025-26 (April 2025 to March 2026 financial year), domestic natural gas allocations for CNG (Transport) and piped natural gas (domestic household cooking gas) segments will be done on a two-quarter advance basis," the ministry said in a statement. 

Besides the lower-priced APM gas produced from old fields given on a nomination basis, the allocation will also now include gas from new wells drilled on the nomination fields of ONGC and Oil India Ltd (OIL), it added. 

The gas from new wells is slightly more expensive than the APM gas.