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Ogra to protect rights of all stakeholders

National

May 18, 2018

ISLAMABAD: The Oil and Gas Regulatory Authority (Ogra) chairperson said that the authority is determined to protect the rights of all stakeholders in accordance with law and in the best interest of public.

Ogra Chairperson Uzma Adil Khan said this while chairing public hearings organised by Ogra at Peshawar, Lahore, Karachi and Quetta on petitions filed by Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL), a news statement issued here by Ogra said on Thursday.

The petitions were to determine the SNGPL’s and SSGL’s estimated revenue requirements/prescribed prices for FY2018-19. The hearings were attended by representatives of various associations, representatives of chambers of commerce, members of press and stakeholders like consumers, public, management of the SNGPL & SSGC and other interveners. Senior Management & Legal Counsel of SNGPL & SSGCL made detailed presentations and gave the reasons for their estimated revenue requirement/prescribed prices. They also responded to a number of questions raised by participants/interveners.

SNGPL and SSGCL filed their petitions on December 29, 2017 and February 28, 2018 respectively, under Section 8(1) of Ogra Ordinance 2002 and Rule-4(2) of Natural Gas Tariff Rules 2002 to determine their estimated revenue requirement for FY2018-19.

SNGPL requested an average increase of Rs356.89/MMBTU in its average prescribed price w.e.f 1st July 2018 while SSGCL requested an increase of Rs109.03/MMBTU in its tariff w.e.f 1st July 2018 for the year 2018-19.

The increase in prescribed prices were claimed by the petitioners mainly due to projected increase in cost of gas, which is based on the average price of crude oil/fuel oil in the international market, in accordance with the Gas Price Agreements signed between the government of Pakistan and the gas producers and devaluation of rupee against US dollar.

The authority in order to provide equal opportunity to all the stakeholders decided to hold public hearings at provincial headquarters and accordingly issued notices to all the interested and affected persons.

The participants opposed the petitions saying that Ogra has already allowed increase in gas prices and any further increase in gas prices shall have adverse effect on gas consumers. It was desired that cross-subsidy mechanism should be abolished and the value addition sectors should be preferred for supply of gas.

The participants raised strong reservations over the high UFG level of SNGPL & SSGCL and demanded that no relief in UFG benchmark be given on account of gas consumers. It was also stressed that the petitioners must endeavour to cut its operating cost to avoid increase in gas prices.

Winding up the public hearings, Ogra chairperson said that it was the duty of the authority to balance the divergent interests of utility companies and consumers. The authority will scrutinise all costs with the help of a team of professional engineers, financial and legal experts.

She said that Ogra has provided opportunity to all the stakeholders in the hearings and thanked for their whole-hearted participation in the proceedings and said that their tangible suggestions will be considered while deciding the petitions of SNGPL & SSGCL.

The Ogra has been established by the federal government under Presidential Ordinance No. XVII of 2002. It, inter-alia, is empowered to determine the revenue requirement of the gas companies.

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