The petroleum ministry wants to shift a total burden of Rs9 billion onto bill-payers. DESIGN: FAIZAN DAWOOD
While denying the petroleum ministry’s demand to shift the burden of billions of rupees worth of gas theft to bill-paying customers, the Oil and Gas Regulatory Authority (Ogra) has rejected another plan that called for charging gas consumers for a fixed amount of gas in addition to their actual consumption.
The petroleum ministry wants to shift a total burden of Rs9 billion onto bill-payers. This amount was incurred in losses by gas companies on account of gas pilferage, minimum billing and gas consumed in lawless areas during the last financial year. The cabinet has already given its go-ahead to the plan, subject to the condition that the amounts charged under these heads do not exceed a maximum limit.
Meanwhile, the petroleum ministry is also pushing a demand that allows gas companies to charge their customers for a total of 11.52 billion cubic feet per day (bcfd); as what it terms ‘minimum billing’.
Ogra has refused the proposal. “We propose that only the metered volume of gas be allowed to [be charged by] gas companies in this regard,” the Ogra chairman said in a letter sent to the petroleum ministry, a copy of which is available with The Express Tribune.
Ogra Chairman Saeed Khan has also proposed an upper cap on gas consumed by non bill-paying consumers and for consumers living in lawless areas. The options proposed have been put forward to cap the chargeable volume of gas theft, keeping in mind the Cabinet’s directives. They may be implemented after consultation with the petroleum ministry.
The petroleum ministry is demanding that Sui Northern Gas Pipelines (SNGPL) be allowed to charge customers for 3.38 bcfd of gas consumed last fiscal year in areas where the gas utility’s teams could not enter to read meters and bill consumers accordingly. Similarly, it wants the SSGC to be allowed to bill consumers on its network for 1.29 bcfd of gas under the same head. The Ogra chairman has dismissed the demand, placing the upper cap at 2.14 bcfd for SNGPL, while not allowing SSGC to charge anything since it has not claimed such losses earlier.
Similarly, the petroleum ministry wishes that SNGPL be allowed to charge customers for at least 11.17 bcfd on account of gas stolen or unaccounted for, and that SSGC should be allowed to provision for 2.06 bcfd.
Ogra has provided its own counter-offer. “The volume for non-consumers may be capped at the level allowed in financial year 2010-11: at 6.61 bcfd for SNGPL and 0 bcfd for SSGC, since such volume has not been claimed by SSGC earlier,” Khan said.
The regulator also said that the volume of gas theft may be adjusted after actualisation of the volume by a competent court in the jurisdiction in which gas is stolen, under the provisions of the Criminal Amendment Act 2011, after formal complaints are registered.
Ogra further said that the volume of theft, once determined by the courts, shall be reconciled on a yearly basis with the volume allowed by Ogra. The regulator has also said that the volume of gas theft must be reduced significantly over the next three years, after which it may revise the current caps on the maximum billable amount. It also pointed out that detecting pilferage is the responsibility of gas utilities, which is why the regulator cannot allow it to bill customers for as much as it wants to under the head.
Published in The Express Tribune, December 28th, 2012.
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