OGRA hikes gas price by up to 16.37%

The Oil and Gas Regulatory Authority (Ogra) has increased the average prescribed price of gas by up to 16.37% besides curtailing new gas schemes and connections.

In two separate decisions on the estimated revenue requirement (ERR) of public gas utilities for fiscal year 2021-22, the regulator jacked up the prescribed gas price by 16.37%, or Rs94 per million British thermal units (mmbtu), for the consumers of Sui Northern Gas Pipelines Limited (SNGPL) and by 6.35%, or Rs50 per mmbtu, for the consumers of Sui Southern Gas Company (SSGC).

Against Ogra’s decision of August 2021 pertaining to ERR of Rs236.749 billion, or Rs576.32 per mmbtu, for financial year 2021-22, SNGPL had filed a review petition demanding ERR of Rs308.478 billion with an increase of Rs269.03 per mmbtu in the average prescribed gas price.

It had requested the fixing of average prescribed price at Rs845.35 per mmbtu. However, Ogra has allowed ERR of Rs227.485 billion with average prescribed price of Rs670.37 per mmbtu.

Against the regulator’s decision of Rs779.88 per mmbtu average prescribed price for SSGC, the company had filed a review petition and projected a shortfall in revenue requirement of Rs18.4 billion for FY22.

It also sought an increase in its average prescribed price by Rs58.42 per mmbtu effective July 1, 2021.

At that time, the petitioner had also estimated the cost of re-gasified liquefied natural gas (RLNG) services at Rs30.48 per mmbtu.

SSGC had ERR of Rs269.086 billion, or average prescribed price of Rs838.3 per mmbtu. However, Ogra determined ERR at Rs266.307 billion, or Rs829.48 per mmbtu.

The regulator has expressed concern over the downward revision in new gas connections and gas schemes for unknown areas in the revised ERR of SNGPL for financial year 2021-22.

Published in The Express Tribune, March 3^rd, 2022.

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