Major increase in gas price expected in Pakistan

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ISLAMABAD: The Sui Southern Gas Company (SSGC) and Sui Northern Gas Private Limited (SNGPL) have sought an increase in the gas tariff from the Oil and Gas Regulatory Authority.

SSGC has asked to increase the tariff by Rs109.78 per metric million British thermal unit (mmbtu) and SNGPL by Rs857.40 per mmbtu. They want the gas tariff increase to start from July 1, 2021.

SNGPL has asked for an estimated revenue requirement (ERR) for financial year 2021-22 in its petition. It has projected an increase of Rs1415.91 per mmbtu, including the previous years’ shortfall of Rs66.75 per mmbtu for financial year 2021-22 in normal business.

The cost of RLNG, diverted towards the domestic sector, has been claimed in the petition at Rs27.940 billion as part of the cost of gas.

The SNGPL has sought an increase in revenue requirement for financial year 2021-22 by 35.38% to Rs283.099 billion from 209.113 billion. In its petition, SNGPL has mentioned that it is also facing previous year’s shortfall of Rs254.108 billion.

SSGC, however, has asked for increase in the prescribed price of gas by Rs109.78 per unit for an estimated revenue requirement for financial year 2021-22, mainly because of an increase in operating cost which has increased to Rs25.595 billion from Rs19.273 billion and return on assets which amounted to Rs7.704 billion.

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