KARACHI, Sept 28: The Sui Southern Gas Company earned a profit-after-tax of Rs290 million for the period ended June 30, 2007 as compared with Rs892 million in the previous year. The impact of disallowances for excess unaccounted for gas (UFG) and other items by the Oil and Gas Regulatory Authority (Ogra), which combined with a prior year tax charge of Rs179 million and increased financial charges reduced the profit for 2007.

With a planned capital expenditure for the current year at a record high, reduction in UFG and improved financial management, the company expects profitability in future.

This was declared in the financial results for the year ended June 30, 2007 in a meeting of the board of directors held in Karachi on September 27. The meeting was presided over by Aitzaz Shahbaz, chairman SSGC. The board also reviewed and approved the company’s audited accounts for 2006-07.

The sales revenue of SSGC increased in value over the previous year by 11 per cent to Rs76.3 billion. The power sector was the largest customer segment with KESC being the single largest customer accounting for 22 per cent of sales by volume and 25 per cent by value. The company’s customer base rose by 92,139 to 1.94 million, says a press release.

The volume of the gas purchases increased marginally and the cost of gas sold increased by six per cent during the year. Increased off-takes were mainly from the Bhit and Zamzama gas fields. The cost of gas now represents 77 per cent of the average selling price against 81 per cent of previous year and shows a marked improvement.

The operating cost excluding depreciation increased by three per cent over the previous year despite strong inflationary pressures. This, as a percentage of revenue, declined from 6.1 per cent to 5.6 per cent, which is a robust benchmark of increased productivity and efficiency.

The current year’s operating cost included expenditure on the gas import projects aimed at securing future supplies.

The transmission network had increased by 228 km with an increase in capacity of 124mmcfd. The distribution network was enhanced by 2,290 km.