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July 16, 2020

RLNG prices raised 6.4pc for SSGC, 5.7pc for SNGPL

Business

July 16, 2020

ISLAMABAD: The government on Wednesday raised prices of re-gasified liquefied natural gas (RLNG) for July by 5.65 percent month-on-month for Sui Northern Gas Pipelines Limited (SNGPL) and 6.35 percent for Sui Southern Gas Company (SSGC).

The Oil and Gas Regulatory Authority (Ogra) notified the new RLNG prices at $6.67 per million metric British thermal unit (mmBtu) for SSGC’s consumers and $6.47 per mmBtu for consumers of SNGPL. In absolute terms, the RLNG price was increased by 0.3984/mmBtu for SSGC and $0.3466/mmBtu for SNGPL.

RLNG price was $6.2716/mmBtu for SSGC and $6.1284/mmBtu for SNGPL in June when the government had slashed prices of RLNG 19.1 percent for SSGC and 18.4 percent for SNGPL.

Ogra earlier advised the government to reduce local natural gas prices by up to six percent. Though it is beneficial for local consumers and industrial sector, but it increases losses of SNGPL and SSGC.

The government, however, did not allow them to charge consumers for their own losses. Instead, the government reduced the prescribed prices of gas for the companies due to low oil prices in international market. The prescribed gas price for SNGPL was reduced by Rs40.94/mmBtu, or 6.1 percent, to Rs623.31/ mmBtu and it was reduced by Rs18.30/mmBtu, or 2 percent, to Rs750.90/mmBtu for SSGCL.

The new prices of RLNG include charges of the LNG terminals, transmission losses, port charges, and margins of the importers – Pakistan State Oil (PSO) and Pakistan LNG Limited (PLL).

The new weighted average sale prices of RLNG have been computed based on the nine cargoes imported in the month including six cargoes by PSO and three by PLL.

LNG is an imported product and remains pegged with the international oil prices. With the movement of oil price in the international market, local RLNG price is also changed.