ISLAMABAD: The Oil and Gas Regulatory Authority (Ogra) has recommended a three percent and eight percent reduction in the current prescribed consumers’ gas price for the Sui Northern Gas Pipelines (SNGPL) and Sui Southern Gas Company (SSGC), respectively, for the fiscal year 2025-26.
However, the federal government will advise on category-wise sale prices within 40 days from the date of determination. Any revision, as advised by the federal government, shall be accordingly notified by the Ogra. Till such time, the existing category-wise natural gas sale prices shall continue to prevail.
The oil and gas regulator recommended a reduction in gas tariff for both gas companies against the Review of Estimated Revenue Requirement (RERR) of the SNGPL and SSGC for the fiscal year 2025-26.
The regulator reviewed the revenue requirement of SNGPL & SSGCL and rationalized the demand by optimizing costs as well as revenues. Moreover, the impact of deferred cargoes in the case of Pakistan LNG Limited has been included to the benefit of gas consumers.
Gas companies seeking 5pc increase in prices
Accordingly, an average prescribed price for Fiscal Year 2025-26 of SNGPL & SSGCL has been provisionally determined at Rs 1,804.08/MMBTU and Rs 1,549.41/MMBTU, thereby reducing the price by three percent and eight percent, respectively, over the current prescribed price.
Moreover, the Ogra, in pursuance of the Federal Cabinet’s decision dated July 01, 2024, has adjusted Rs 13,565 million in the case of the SNGPL and Rs 47,315 million in the case of the SSGCL against the previous shortfall/stock of gas circular debt.
Both gas companies sought massive hikes in prescribed gas prices for fiscal year 2025-26, citing a combined shortfall of over Rs77 billion to cover rising costs and system inefficiencies.
Both companies separately filed their petitions to review their estimated revenue requirements/prescribed prices for FY2025/26.
The SNGPL demanded an increase of Rs189 per million British thermal units (MMBTU), raising its average prescribed price to Rs1,955.50 per MMBTU from the current Rs1,766.50. The company projects a revenue shortfall of Rs52.958 billion for the fiscal year 2025/26, driven by higher imported RLNG costs, operating expenses, and depreciation.
The SSGC sought a Rs125.41 per MMBTU increase, requesting an average prescribed price of Rs1,783.96 per MMBTU compared with the current Rs1,658.55.
The southern utility reported a projected shortfall of Rs24.049 billion and attributed the demand mainly to escalating gas purchase costs, depreciation, and financial charges.
Copyright Business Recorder, 2025
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