ISLAMABAD: Oil and Gas Regulatory Authority (OGRA) has asked the Federal Government to increase the price of gas by 2% for the consumers of Sui Northern Gas Pipeline Company (SNGPL).

According to OGRA handout, SNGPL demanded an increase of 123% or Rs 773 per MMBTU for the financial year 2021. However, OGRA after holding several public hearings and extensive meetings with all stakeholders decided to recommend increase Rs 13.42 per MMBTU. 

“OGRA has determined Review of Estimated Revenue Requirement (RERR) of SNGPL for FY2021 and has sent the same to Federal Government for sale price advice,” the statement said.  It is further stated that any revision as advised by the Federal Government shall be accordingly notified by OGRA. Till such time the existing category-wise natural gas sale prices shall prevail. 

The sales volume for FY21 demanded by SNGPL was RS 324.3 billion and existing average sales price of Rs 631.42 was allowed by OGRA. However, the revenue requirement demanded by SNGPL was 240.36 billion, which slashed by OGRA to 209.11 billion. 

SNGPL also demanded recovery of previous year revenue shortfall of 215.24 billion which accumulated over the years because of not increasing the tariff of gas as per OGRA recommendations. By adding the revenue shortfall of previous year SNGPL demanded Average Prescribed Price of 1404.92 per MMBTU which heavily slashed by OGRA to Rs 644.84 per MMBTU. OGRA said that the reason for a reduction in price is stability in US$ exchange along with other disallowances made by OGRA in respect of revenue & capital expenditures.

It may be mentioned here that Special Assistant to PM already stated that the gas distribution companies would be allowed to recover their arrears gradually to put the minimum burden on the consumers. He criticized the previous PML(N) for keeping the gas prices stagnant and because of it the circular debt of two gas distribution companies SNGPL and SSGC reached over Rs 350 billion.


Please enter your comment!
Please enter your name here