ISLAMABAD, July 29: On the recommendations of the Oil and Gas Regulatory Authority (Ogra), the natural gas tariff for all consumers will remain frozen until January 1, 2008, it is learnt.
“The government has formally decided not to change the existing gas prices for another six months,” a senior petroleum ministry official told Dawn. The Ogra has been informed about the decision in writing, he added.
On the basis of a half-yearly review of accounts and prescribed prices of the Sui Southern Gas Company (SSGC) and Sui Northern Gas Pipelines Limited (SNGPL), the Ogra had recommended that there were not sufficient grounds for a tariff increase and a nominal rise in the gas companies’ expenditure could be met without burdening consumers by making minor adjustments on paper.
The Ogra law requires the government to revise gas rates biannually in July and January respectively on the basis of Ogra recommendations. There would be no need for a fresh notification because of unchanged gas rates.
The Ogra had determined that prescribed prices of SNGPL required a minor increase of Rs1.78 per MMBTU (million British Thermal Units) on the basis of its revenue requirements and expenditures for the year 2007-08. Therefore, the increase had been adjusted in consumer categories where prescribed prices were lower. “Increase of Rs1.78 per MMBTU in the petitioner’s average prescribed prices has been adjusted in those categories of consumers where prescribed price was less than the sale price,” the Ogra said in its determination on SNGPL.
Similarly, a scrutiny of the SSGCL accounts revealed that it required a nominal 27 paisa per unit MMBTU increase in its prescribed prices to meet the difference between its revenue requirements and expenditures. This, too, had been adjusted against comparatively higher gas development surcharge that was accruing to the government.
