ISLAMABAD: The two gas utilities — SNGPL and SSGCL — have sought up to a 54 per cent increase in prescribed prices to meet their revenue requirements for the current fiscal year (FY25).
Gas prices are revised twice a year under the law, based on determinations by the Oil & Gas Regulatory Authority (Ogra), which the government uses to set consumer prices for various categories.
Ogra has announced public hearing on November 8 to consider Sui Southern Gas Company Limited (SSGC) request for Rs669 per unit (mmBtu) or 53.5pc. The public hearing for Sui Northern Gas Pipeline Limited (SNGPL) request for a hike of 3.66pc or Rs64.16 per mmBtu is scheduled for November 5.
SNGPL filed a petition on October 15 and subsequently submitted an amended petition on October 18 for a review of its estimated revenue requirement for FY25. The company projected a shortfall in revenue of Rs20.582 billion, including Rs489 million on account of LPG Air Mix Project, seeking an increase in its average prescribed price by Rs64.16 per mmBtu.
The company said it had included the cost of RLNG-diverted volumes to indigenous gas consumers as part of the cost of gas in light of the ECC decision ratified by the federal cabinet on October 30, 2023. The cost of gas is linked to international prices of HSFO and crude oil/Brent, in accordance with agreements signed between the federal government and gas producers/suppliers.
SNGPL has sought a hike of Rs64.16 per mmBtu in tariff which, if approved, will jack up the average prescribed price from Rs1746.22 to Rs1810.38 per mmBtu, according to Ogra. The Lahore-based gas utility claimed RLNG cost of service of Rs304.27 per mmBtu for FY25.
On the other hand, SSGCL has projected a shortfall in revenue requirement for FY25 at Rs140bn, seeking a hike in average prescribed price effective from July 1, 2024 to compensate for increase in cost of gas. The Karachi-based company sought a hike of Rs669.07 per mmBtu in the average prescribed price which will take its price from Rs1,251.32 to Rs1,920.39 per mmBtu.
SSGCL has also claimed Rs643bn (Rs3073.91/mmBtu) related to previous years’ un-recouped shortfall as part of petition. Also, the petitioner has estimated RLNG cost of service at Rs46.13 per mmBtu for FY25.
Published in Dawn, October 30th, 2024
