ONGC gains on stock split, gas price hike

Shares of Oil and Natural Gas Corp (ONGC) vaulted nearly 5.1 per cent after the government allowed the state-run explorer to split its share and announce a bonus issue and increase price of gas sold to consumers in non-priority sectors by up to 10 per cent.

The government approved a 10 per cent hike in the price of natural gas that state-owned firms sell to consumers in non-priority sectors such as steel and petrochemicals, reports said.

"Effective December 1, ONGC and OIL have been allowed to charge up to $5.25 per million British thermal units for 7-8 million standard cubic meters per day of gas that is sold to non-power and non-fertiliser sector," reports quoted a senior government official as saying.

Consumers along the Hazira-Vijaipur-Jagdishpur and Dahej-Vijaipur pipelines, including Maharashtra, Gujarat, Rajasthan, Madhya Pradesh, Uttar Pradesh, Haryana and Delhi, will pay $5.25 per mmBtu.

Users in Rajasthan, south Gujarat and isolated customers in Gujarat, which get gas from identified onshore fields, will be charged $5 per mmBtu while consumers in Tamil Nadu and Andhra Pradesh will pay $4.75 per mmBtu and $4.5 per mmBtu, respectively. Consumers in the North East will pay $4.2 per mmBtu.

The cabinet also approved issue of one bonus share to ONGC's stockholders for each share held.