Gas utilities seek Rs93-Rs114 per mmbtu tariff rise

ISLAMABAD: Gas companies have sought increase in gas tariff by Rs93-Rs114 per mmbtu from July 1, 2017, for the financial year 2017-18.

Both the gas utilities-- Sui Northern and Sui Southern--have submitted their petitions to Ogra, seeking increase in the prescribed prices of gas by Rs93 per mmbtu and Rs114.57 per mmbtu from July 1, 2017 under estimated revenue requirement (ERR) for 2017-18.

In the petition, Sui Northern pleads that it has sustained Rs60.643 billion losses which include the shortfall of Rs40.834 billion in normal business and Rs19.809 billion in LNG business and likewise; Sui Southern has come with the deficit of Rs42.163 billion in its petition.

Sui Northern has also mentioned in the petition that it has braved the loss of Rs19.809 billion in the LNG business and asked the regulator to increase the LNG price by Rs44.49 per mmbtu.

According to the petitions of which copies available with The News, Sui Northern has also asked Ogra to allow it to pass the mammoth amount of Rs897 million--the burden accumulated in the head of late payment surcharge (LPS) to end consumers.

The top management of Sui Northern has requested the regulator to treat LPS amount as operating expenses for 2017-18. This means that Sui Northern wants to fleece the amount of LPS from consumers to pay Pakistan State Oil. When Sui Northern delays the payment to PSO, it exposes to the late payment surcharge--the penalty against not paying to PSO on time. The experts say that regulator should not allow Sui

Northern at any cost to pass the LPS amount on to end consumers as timely payment of dues to PSO is the responsibility of Sui Northern and failure in timely payments is the inefficiency of the entity.

Under its petition, the Sui Northern has sought the increase from Rs480.63 to Rs573.76 per mmbtu for the domestic sector consumers consuming the gas up to over 300 cubic metres per month. The said gas utility has also demanded the same increase in tariff for the gas supply for almost all categories of consumers that include commercial, special consumers (Roti Tandoor), Ice factories, general industrial consumers, CNG sector, cement factories, fertilizer factories, and power stations.