Natural gas price paid to producers like Reliance Industries and Oil and Natural Gas Corp (ONGC) is likely to dip 20 percent to $2.45 in October.
The fall will be the fourth reduction in nearly 18 months after the formula was given green signal by the government in October 2014.
Price of natural gas produced from RIL and ONGC may fall to $2.45 per million British thermal unit with effect from October 1 as against $3.06 currently, a senior official said.
This rate is on gross calorific value (GCV) basis.
Gas price was last dropped on April 1 from $3.82 per mmBtu to $3.06 per mmBtu.
That daym On a net-calorific value (NCV) basis, the gas price was dipped to $3.4 per mmBtu as compared to $4.24 previously.
On basis of NCV, new gas price is likely to be $2.7 from October 1.
According to new gas pricing formula approved by Centre in October 2014, gas prices are to be revised every six months and the next change is likely on October 1.
The reduction in natural gas prices would mean lower raw material cost for compressed natural gas (CNG) and natural gas piped to households (PNG) and would translate into reduction in retail prices.