KP govt rejects proposed increase in gas tariff

PESHAWAR: The government of Khyber Pakhtunkhwa on Monday rejected the Sui Northern Gas Pipelines Limited (SNGPL)-proposed increase in the tariff of gas and said it would further burden the consumers.

The provincial government representing the consumers at Oil & Gas Regulatory Authority (OGRA)'s public hearing it conducted here regarding Sui Northern Gas Pipeline Limited (SNGPL) Estimated Revenue Requirements for financial year 2018-19, opposed the hike in gas prices.

The SNGPL proposed a hike in prescribed rates of about 78 percent amounting to Rs389 per MMBTU which will eventually increase the end consumer gas prices for 2018-19, a press release said. The provincial government rejected the proposal and insisted that the gas prices may not be increased. It insisted that rather it could be decreased through better planning, management and following international best practices.

The release said that the provincial government representatives said that the petition submitted by SNGPL was not drafted in light of Article 158 of the Constitution which states that gas priority shall be given to the province in which gas is producing to fulfill its requirements.

The province's team stated that as per the petition, the SNGPL has not planned any transmission network in the province for the fiscal year 2018-19. Even the distribution network is planned for specific region and not throughout the province. It said that only 14 percent of the total gas connections are allocated to the province which is breach of Article 158, Supreme Court's directives, Peshawar Court orders, Prime Minister's directives and Federal Minister for Energy decisions. It further stated that the SNGPL had refused to purchase gas from Baratai Well which is a recent discovery by the Oil and Gas Company Limited(OGDCL) and Khyber Pakhtunkhwa Oil and Gas Company Limited (KPOGCL).

According the release, 30 MMCFD of gas is capped at Baratai and the country is losing billions of rupees annually on account of Foreign Exchange in import of LNG and Royalty. Chairperson OGRA didn't let the representative of government of KP to complete the presentation and ended the hearing on the note that OGRA has no mandate of implementing the constitutional provisions as laid down in Article 158, it said.