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ISLAMABAD: Sui Northern Gas Pipeline Limited (SNGPL) has demanded a substantial increase in price of gas, ie, up to 66 percent for the fiscal year 2022-23.

The Oil and Gas Regulatory Authority (Ogra) conducted a public hearing in Lahore on Wednesday at a local hotel on the petition filed by the SNGPL for the Determination of its Estimated Revenue Requirements (DERR) and prescribed prices for fiscal year 2022-23.

The petitioner projected average Prescribed Price at Rs920.88/MMBtu for fiscal year 2022-23.

The petitioner has further requested Rs1,172 MMBtu on account of previous years’ shortfall.

Accordingly, the aggregate average prescribed price has been requested at Rs2,074.89 per MMBTU including previous years’ shortfall in the natural gas business.

The petitioner has also projected RLNG cost of service at Rs490.1,8 per MMBTU w.e.f July 01, 2022 for RLNG business, including Rs330.68/ MMBTU on account of the differential impact of RLNG diversion.

The SNGPL had sought a shortfall in revenue due to the diversion of LNG towards domestic consumers.

Ogra hikes gas prices

The Parliament had also passed a bill to introduce weighted average cost of bill (Wacog).

The CNG industry has termed Wacog legislation illegal as provinces were not taken on board to seek consent.

A private party in Sindh had challenged this bill in court and the Sindh government had also announced to become part of this case.

The SNGPL claims that it had to receive over Rs100 billion from domestic consumers but it could not recover it due to absence of any legal framework.

At present, the SNGPL is to pay over Rs278 billion to the PSO on account of LNG supply.

At present, the SNGPL is a key defaulter of PSO that is to pay the huge bill of LNG supply.

But the SNGPL has not been able to pay as it claims that domestic consumers had consumed LNG in winter seasons but they did not pay bills.

During a public hearing held in Lahore by the OGRA, senior leader of the All-Pakistan CNG Association, Ghayas Paracha, opposed increased rates of gas and pointed out irregularities in the distribution of gas to the customers.

He said that Wacog gas pricing could not be implemented without taking all the stakeholders into confidence.

He said that the line losses of gas companies had increased too much.

The separate UFG applied to the transmission and distribution of gas is unacceptable, he said.

He said that charges of pipeline capacity and terminal charges including retaining charges had not been reviewed for several years.

He urged to review them now.

Under the third-party rules, he said that there would be a uniform tariff for all companies and sectors and added there should be no discrimination.

He said that the government companies had failed to import LNG and therefore, private companies should be allowed to import gas to fulfil their demand.

It is illegal to close CNG stations. Paracha said the company could reduce gas supply only in case of gas shortages.

Copyright Business Recorder, 2022


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