RLNG price slashed for July, LPG raised for August

ISLAMABAD: The Oil and Gas Regulatory Authority (Ogra) announced on Wednesday a reduction of up to $1.2347 per MMBtu in the price of re-gasified liquefied natural gas (RLNG) for July 2024, while increasing the price of liquefied petroleum gas (LPG) by Rs2.27 per kilogram for August 2024.

Notably, the regulator notified the RLNG prices after the month of July had already ended. When contacted, an Ogra spokesperson explained the delay in the RLNG price notification, stating, “We received the data from Pakistan State Oil (PSO) and Pakistan LNG Limited (PLL) late, and our calculations also take time.”

The delay in the RLNG price notification was also highlighted during the National Electric Power Regulatory Authority (Nepra) public hearing on the monthly fuel charges adjustment (FCA) for distribution companies (Discos) on Wednesday. The petitioner, Central Power Purchasing Agency (CPPA), noted that Ogra’s delayed notification complicates their case presentations, as they often lack the necessary RLNG price information.

As per the notification, the RLNG price for Sui Northern Gas Company Ltd (SNGPL) consumers will decrease by $1.2347 per MMBtu, or 8.44 percent, while for Sui Southern Gas Company (SSGC) consumers, the reduction is $1.2226 per MMBtu, or 8.5 percent.

The new RLNG price for Sui Northern is set at $13.39 per MMBtu, down from $14.62 per MMBtu in June. For Sui Southern, the price will drop to $13.15 per MMBtu, down from $14.37 per MMBtu in June.

As per another notification of the Ogra for LPG, the price of LPG will rise from Rs234.73 per kilogram in July to Rs237 per kilogram in August. The hike in LPG prices is attributed to an increase in global LPG prices, the authority said.

As a result of the new rates, the cost of an 11.8 kilogram domestic LPG cylinder will increase to Rs2,796.56 from Rs2,769.66 in July. The price of a 45.4 kilogram commercial cylinder will also rise to Rs10,759.35. These adjustments will be effective from Thursday (today).

Ogra noted that the LPG producer price is influenced by the Saudi Aramco Contract Price (CP) and the exchange rate of the US dollar. Compared to the previous month, the Saudi Aramco CP has risen by 1.22 percent, while the average dollar exchange rate has decreased by 0.0107 percent. This resulted in a Rs26.90 increase per 11.8-kilogram cylinder, or 0.97 percent. The per-kilogram increase in LPG consumer price is Rs2.27, Ogra said.

The regulator calculated the producer price of LPG, assuming a composition of 40 percent propane and 60 percent butane, to be Rs161,175.33 per tonne. This includes an excise duty of Rs85 per tonne but excludes the petroleum levy of Rs4,669 per tonne. The total cost for an 11.8 kilogram cylinder is Rs1,901.87. Without an 18 percent general sales tax (GST), the producer price would have been Rs165,844.33 per tonne, leading to a cylinder price of Rs1,956.96. The GST on this amount would be Rs29,851 per tonne or Rs352.25 per 11.8-kilogram cylinder.

Ogra also determined the maximum producer price at Rs195,696.31 per tonne (including GST), or Rs2,309.22 per 11.8 kilogram cylinder. Marketing, distribution, and transportation margins have been set at Rs35,000 per tonne, with a marketing margin of Rs17,000, a distribution margin of Rs10,000, and a transportation margin of Rs8,000, resulting in a total margin of Rs413 per cylinder. Consumers will also face an 18 percent GST of Rs6,300 per tonne or Rs74.34 per 11.8-kilogram cylinder on these margins.

The maximum LPG consumer price will be Rs236,996.31 per tonne or Rs2,796.56 per 11.8-kilogram cylinder. The maximum LPG price will be Rs237 per kilogram.