factually stood at 0.52 percent which was not justified.
Chairman Ogra Saeed Ahmad Khan said their decision was provisional and was announced to facilitate the government to initiate the process to recover bills from the power sector for the LNG it had used.
He said the decision would enable the government to carve out a sustainable payment mechanism so that it could enter into the LNG deal with Qatar under government to government arrangement.
He said gas companies had the right to go for review of the decision, but they could not be accommodated.He said the margins and charges they wanted to get were already being received as all were embedded in the prescribed gas prices.
“However, the PSO can also submit a petition to the Ogra seeking review of its decision on the margin. And we have to look at the rationale the PSO will market to Ogra during the public hearing. We have to decide after listening to counter arguments of other stakeholders and the margin of PSO can further go down if the said entity fails to plead with convincing argument,” said the Ogra chief.
However, the officials of the regulator were of view that the Ogra had determined the LNG sale price not under the Ogra Ordinance, but in the light of Petroleum Development Levy Act, as LNG was a petroleum product. So the said decision could not be alerted.
“However, the issue of margin can be looked into once the public hearing of petitions of stakeholders are submitted and admitted by the regulator.”He said gas entities also had reservations about the decision of PSO and they would also move again the decision.
It is pertinent to mention that prior to the announcement of provincial LNG sale price, the ministry wanted the Ogra to let the PSO charge 4 percent margin on RLNG arguing that it collects same volume of charges on import of fuel.
“Since LNG is a petroleum product, we allowed the PSO to charge 4 percent margins,” the minister had told The News while arguing the stance of the ministry just before the announcement of LNG price. However, Ogra showed defiance and reduced the margin of PSO to 1.8 percent from 4 percent.
The Ogra under the much-touted decision had also reduced the retainage of 3 percent to 0.75 percent and fixed LNG terminal handling at 66 cents per MMBTU. Before that the LNG terminal was charging $1.85 per MMBTU.