ISLAMABAD, Nov 1: Consumers will continue to get CNG at the existing reduced prices determined by the Oil and Gas Regulatory Authority on Oct 25 as the Supreme Court ordered on Thursday to freeze them till Nov 19.

And when the court will take up again the issue of gas pricing on Nov 19 the Sui Northern Gas Pipelines Limited (SNGPL) and the Sui Southern Gas Company (SSGC) will apprise it of the measures they have taken to check the UFG (unaccounted for gas) losses.

A bench comprising Chief Justice Iftikhar Mohammad Chaudhry and Justice Jawwad S. Khawaja spoke about measures to check allegations relating to gas theft and pilferage the cost of which the consumers had to pay in the shape of UFG losses.

After the recent reduction of prices by Rs30.84 per kg, the CNG is being sold at Rs61.64 in Region-I (Khyber Pakhtunkhawa, Balochistan and Potohar, including Rawalpindi-Islamabad and Gujar Khan) and at Rs54.16 in Region-II (Sindh and Punjab).

During the proceedings, Justice Khawaja observed that the CNG association had become a cartel and regretted that the government signed an MoU (memorandum of understanding) with it. The MoU determined the operating cost and profit of CNG stations by almost Rs30 per kg which was suspended by the government on Oct 25.

Advocate Wasim Sajjad, representing the Sindh CNG association, conceded that the government had not only supported the cartel but also recognised it, adding that the government should be directed not to coerce the CNG owners.

The observation about the association having become a cartel was made when Petroleum and Natural Resources Secretary Waqar Masood candidly accepted before the court that the (CNG) mafia was pressurising the government.

The chief justice observed that the mafia could not dictate the court because it had no business with them.

Mr Masood also informed the court that the matter of petroleum levy was pending before the Lahore High Court. The LHC had issued a stay order a year ago.

At this the apex court asked the authorities concerned to request the LHC for an early hearing and observed that determining prices of petroleum products was the job of Ogra, and not of courts.

The court took notice of a statement of Adviser to the PM on Petroleum Dr Asim Hussain in which he had expressed his helplessness in a talk show. Dr Asim claimed that the petroleum mafia had deferred to the petroleum policy under the court’s orders. The court asked the adviser not to be scared of the mafia’s threats and praised the government for reducing the gas price.

“The credit goes to the government,” the chief justice said, adding that the prices had been fixed by the government and not by the Supreme Court. “Even those bar members who were criticising the role of the court in reducing the prices should read our order first.”

The court directed managing directors of SNGPL and SSGC Arif Hameed and Azeem Iqbal Siddiqui, respectively, to undertake an exercise by following a procedure of forensic cost audit of prices of the gas per kg as well as mmbtu (million British thermal unit) and assist the court in determining how much the consumer is paying for using the gas.

According to the price fixed by Ogra on Oct 27, the SNGPL was receiving gas from the wellhead at Rs18.04 per kg and SSGC at Rs16.48 per kg.

It is equally important to understand, the court noted, how much cost is being borne by the companies by supplying natural gas to CNG stations. The court also noted that the daily production of natural gas in the country totalled approximately 4,000 mmcf (million cubic feet) while the consumption is a little over 3,500 mmcf, though in winter the shortfall sometimes reached 1,100 mmcf.

The fixation of the CNG prices is governed by these factors, the court observed, and ordered the petroleum secretary and Ogra Chairman Saeed Ahmed Khan to submit by Nov 19 details about the gas supplied to different sectors — domestic consumers, industries, IPPs (independent power producers), CNG stations and fertiliser units.