Sui Companies seek Ogra nod for up to 53.47pc hike in gas prices

ISLAMABAD - The Sui Companies have sought the nod of Oil and Gas Regulatory Authority (OGRA) for a hike of up to 53.47 percent in average prescribed prices of gas for the financial year 2024-25. Sui Northern Gas Pipelines Limited (SNGPL) has sought a hike of 3.

66 percent, while Sui Southern has asked for 53.47 per cent increase in the average prescribed prices of gas for FY2024-25. In two separate review petitions, of the Estimated Revenue Requirements (ERR) 2024-25, filed with Ogra, the SNGPL and SSGC have sought a hike of Rs64.



16 per MMBTU and Rs669.07 per MMBTU respectively in the prescribed prices. SNGPL filed a petition before the Authority on October 15, 2024 and subsequently submitted amended petition on October 18, 2024 under Section 8 (2) of the Oil and Gas Regulatory Authority Ordinance, 2002, read with Rule 4 (3) of the Natural Gas Tariff Rules, 2002, for review of its estimated revenue requirement/prescribed price for FY2024-25.

The petitioner has projected shortfall in revenue requirement for FY2024-25 at Rs20,582 million including Rs489 million on account of LPG Air mix Project seeking an increase in its average prescribed price by Rs64.16 per MMBTU for FY2024-25. The petitioner has informed that it has included cost of RLNG diverted volumes to indigenous gas consumers, as part of cost of gas in the light of ECC decision ratified by federal cabinet on October 30, 2023.

The cost of gas is linked to the international prices of HSFO and crude oil/brent in accordance with the agreements signed between the federal government and the gas producers/suppliers. WB team reviews progress of SFERP activities SNGPL has sought a hike of Rs64.16 per MMBTU in tariff, which, if approved, will jack up the average prescribed price from the existing Rs1746.

22 per MMBTU to Rs1810.38 per MMBTU. The breakup of projected prescribed price as claimed by SNGPL includes, Rs918.

47 per MMBTU cost of gas, Rs647.29 per MMBTU cost of RLNG diverted to indigenous consumers, Rs112.31 per MMBTU operating cost, Rs76.

94 per MMBTU for depreciation, Rs1.52 per MMBTU for subsidy to LPG air mix plant, and Rs118.83 per MMBTU return on asset.

The company has shown a saving of Rs 9.02 per MMBTU on account of UFG adjustments, and Rs 55.96 per MMBTU on account of other operating income.

Besides, the petitioner has claimed RLNG cost of service af Rs304.27 per MMBTU for FY2024-25. In its review petition, Sui Southern Gas Company Limited has projected a shortfall in revenue requirement for FY 2024-25 at Rs139,938 million, seeking increase in average prescribed price effective from July 01, 2024 to compensate for increase in cost of gas.

The company has sought a hike of Rs 669.07 per MMBTU in the average prescribed prices which will take its price from the existing Rs1251.32 per MMBTU to Rs1920.

39 per MMBTU. The breakup of projected prescribed prices as claimed by the company for FY 2024-25 includes Rs1540.65 per MMBTU cost of gas, Rs145.

25 operating cost, Rs125.65 per MMBTU UFG adjustment for revenue shortfall in Balochistan, Rs40.81 per MMBTU for depreciation, Rs59.

76 per MMBTU for financial charges on short term borrowing, Rs14.91 per MMBTU for subsidy to LPG air mix plant, and Rs101.06 per MMBTU return on net average operating asset.

The company has shown a saving of Rs71.05 per MMBTU on account of UFG adjustments, and Rs36.66 per MMBTU on account of other operating income.

SSGC has also claimed Rs643 billion (Rs3073.91/MMBTU) related to previous years un-recouped shortfall as part of petition. Also, the petitioner has estimated RLNG cost of service at Rs46.

13/MMBTU for FY2024-25. Oil & Gas Regulatory Authority has invited all interested/affected persons including gas consumers and general public to furnish their comments, suggestions and intervention requests. Ogra will conduct public hearing on SNGPL petition on November 05 at the company headquarters in Lahore, while on SSGC petition it will be held on November 08 at SSGC headquarters Karachi.

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