ISLAMABAD (Kashmir English): Gas prices in Pakistan are expected to rise from July because Sui Northern Gas Pipeline Limited (SNGPL) and Sui Southern Gas Company (SSGC) have requested the Oil and Gas Regulatory Authority (OGRA) to approve their request for a substantial price increase.
The companies are seeking to address a combined revenue shortfall of Rs. 1,650 billion, which has accumulated from both previous losses and projected requirements for the next financial year.
The proposed adjustments will help solve the current energy sector problem, which exists as “circular debt”. The financial demands submitted to OGRA show how much potential consumer impact will result from the upcoming situation.
The specific requests include: Sui Southern (SSGC): The company requests an average prescribed price of Rs. 5,306 per MMBTU. Sui Northern (SNGPL): The company has forecasted a revenue deficit of Rs. 8.73 billion for the upcoming financial year, which will be added to its existing Rs. 585 billion deficit.
LNG Diversion Costs: The two companies have made enormous demands to recover liquefied natural gas (LNG) service and diversion expenditures, which exceed Rs. 100 billion.
OGRA has organized public hearings to assess whether the upcoming price increases will maintain transparent procedures after gas prices in Pakistan are expected to rise from July.
The hearing for SNGPL is scheduled to take place on April 21, while the SSGC session will occur on April 22. The regulator will analyze the companies’ “Unaccounted for Gas” (UFG) losses together with operational expenses before reaching its final decision.
The federal government will provide the final advice on category-wise sale prices after the technical assessment reaches completion. The upcoming price increase will lead to domestic industrial and commercial users experiencing substantial increases in their monthly utility expenses.
