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Saturday June 15, 2024

OGRA raises RLNG prices up to 6.5pc for SSGC, SNGPL consumers

By Our Correspondent
May 25, 2024
The Oil & Gas Regulatory Authority (OGRA) headquarters. — APP/File
The Oil & Gas Regulatory Authority (OGRA) headquarters. — APP/File

ISLAMABAD: The Oil and Gas Regulatory Authority (OGRA) has raised the prices of re-gasified liquefied natural gas (RLNG) for consumers of Sui Southern Gas Company (SSGC) and Sui Northern Gas Pipelines Limited (SNGPL) by over 6 percent effective May 1, 2024.

The price hike, announced on Friday, increased RLNG prices by $0.8559 per million British thermal units (mmBtu) or 6.5 percent for SSGC consumers and by $0.7978 per mmBtu or 6.16 percent for SNGPL consumers.

According to OGRA's notification, the new weighted average sale price for SNGPL consumers has been set at $13.744 per mmBtu, while SSGC consumers will be charged $14.0506 per mmBtu. In April 2024, the prices were $12.946 and $13.1947 per mmBtu for SNGPL and SSGC consumers, respectively. OGRA attributed the increase to higher supply charges.

Since September 2023, RLNG prices have fluctuated, with only two months recording price reductions. In September 2023, prices rose by 3.08 percent, followed by a 3.87 percent increase in October, a 1.2 percent increase in November, and a significant 10.1 percent increase in December.

Prices decreased by 7.8 percent in January 2024 and by 9 percent in February, before rising again by 2.57 percent in March and 1.06 percent in April.

The revised RLNG prices encompass various cost elements, including charges for LNG terminals, transmission losses, port charges, and margins for state-owned importers such as Pakistan State Oil (PSO) and Pakistan LNG Limited (PLL). These new prices are based on the 11 cargoes imported for the month, including 10 by PSO and one by PLL.

RLNG, being an imported product, is pegged to international oil prices. Consequently, an increase in international oil prices necessitates a corresponding price hike by OGRA. RLNG is a major contributor to the country's power generation. Therefore, an increase in RLNG prices elevates the cost of energy, subsequently raising the tariff for power consumers.