Ogra ups gas tariffs for SNGPL, SSGC: effective from January 1, 2012

The Oil and Gas Regulatory Authority (Ogra) has increased the gas tariff for Sui-Northern Gas Pipelines Limited (SNGPL) by Rs 43.93 (14 percent) per million cubic feet (mmbtu) and for Sui Southern Gas Company (SSGC) by Rs 34 (11 percent) per mmbtu. The Ogra has issued a notification on Thursday, according to which the new prices would be applicable from January 2012.
The consumers will pay an amount of Rs 16 billion on account of UFG, while an additional Rs 15 billion for new developmental schemes. According to details, SNGPL and SSGC had requested the Ogra to allow them increase in gas tariff for all the consumers on account of Unaccounted for Gas (UFG) and for laying new gas pipelines on the request of parliamentarians.
The authority while considering the requests of both the companies allowed them to increase gas tariff by 43.93 and Rs 43 per mmbtu, respectively. Both the companies have also shown a revenue shortfall in their final records. The SNGPL final revenue shortfall stood at Rs 8.4 billion while that of SSGC's Rs 6.25 billion.
The companies were of the view that an increase in tariff was inevitable to boost revenue. The two entities say that they had spent hefty amount on advertisements, travelling, legal expenditures and losses to infrastructure in floods. As per rules both the gas utilities are bound to supply gas to the existing consumers, but parliamentarians are pressurising Ogra to allow SNGPL and SSGC start working on new gas developments schemes.