SNGPL seeks massive hike in gas price

LAHORE/KARACHI: Sui Northern Gas Pipelines Limited (SNGPL) has also requested the Oil and Gas Regulatory Authority (Ogra) to jack up the price of gas, Geo News reported on Monday.

The company has sought 147% hike in gas prices from the regulator that would put more burden on the inflation-weary masses.

The SNGPL is the largest integrated gas company serving more than 7.22 million consumers in North Central Pakistan through an extensive network in Punjab, Khyber Pakhtunkhwa and Azad Jammu & Kashmir

According to the TV report, the utility company has requested an increase of Rs2,646.18 per metric million British thermal unit (mmbtu) in gas price and asked that the new average gas price be fixed at Rs4,446.89.

Facing an estimated revenue shortfall of Rs189.18 billion, it has requested to implement the enhanced gas price from July 1.

The petroleum sector regulator will hear the SNGPL plea on March 25 in Lahore and on March 27 in Peshawar.

It may be noted that the SSGC has also submitted a request to the regulator for further hike in gas price, seeking an increase of Rs274.40 per mmbtu.

Meanwhile, the Oil and Gas Regulatory Authority (Ogra) Monday held a public hearing on a petition of Sui Southern Gas Company (SSGC) to further increase in gas prices to meet the company’s revenue shortfall for the financial year 2024-25.

SSGC has filed a petition before Ogra on November 30, 2023 and amended petition on February 23, 2024 for determination of its estimated revenue requirement/prescribed price for fy2024-25. the petitioner has projected average prescribed price Rs1,740.80 per MMBTU for FY2024-25 in natural gas business.

The revenue requirement of the petitioner will enable it to meet cost of gas, operating cost and return on assets. The cost of gas is linked to the international prices of crude oil/fuel oil in accordance with the agreements between the Federal Government and the gas producers.

Besides above, the petitioner has projected RLNG cost of serve at Rs39.56 per MMBTU for RLNG business.

The exclusive rights held by the petitioner in its franchise areas i.e. Sindh and Balochistan have expired as per the respective licence, however, the petitioner has projected Rs1,402 million for laying of 179km distribution mains to connect various new towns and villages, petition said and added that the additional issues include whether projection in gas supplies volume from local gas fields is fair and any steps/measures have been taken by the petitioner to meet country’s increasing energy demand.