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Express Tribune
20-05-2025
- Business
- Express Tribune
OGRA greenlights hike in gas price
The Oil and Gas Regulatory Authority (OGRA) has approved an increase in gas prices for consumers of Sui Northern Gas Pipeline Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL) for the fiscal year 202526. The regulator has forwarded its decision to the federal government for formal notification of category-wise consumer gas prices. Under the law, the federal government is bound to issue the notification within 40 days of OGRA's decision. In a statement, OGRA said that under Section 8(1) of the OGRA Ordinance, 2002, it had determined the estimated revenue requirements (ERR) of both SSGCL and SNGPL through its decisions dated May 20, 2025. The determinations have been submitted to the federal government for category-wise natural gas sale price advice, as required under Section 8(3) of the same ordinance. SSGCL had sought an increase in the average prescribed gas price to Rs 2,398.90 per MMBTU, but OGRA approved a raise of Rs 103.95 per MMBTU. Currently, SSGCL's average prescribed price stands at Rs 1,762.51 per MMBTU. Similarly, SNGPL requested an increase of Rs 707.37 per MMBTU; however, the regulator allowed only Rs116.90 per MMBTU. The rise in SNGPL's prescribed price primarily stems from the impact of the re-gasified liquefied natural gas (RLNG) diversion in line with the federal cabinet's decision dated October 30, 2023. Noting the consistently rising RLNG diversion and its influence on pricing, OGRA directed SNGPL to immediately engage with the federal government to review gas supply management. The authority advised the review to consider sectoral energy demand, international contractual obligations and macroeconomic factors. OGRA reiterated that until revised sale prices are advised by the federal government and formally notified, the existing category-wise gas prices will remain in effect. SNGPL has informed OGRA that declining domestic and commercial gas consumption is largely due to price increases that have altered usage patterns. High RLNG tariffs, increased system gas prices, and a levy on captive power plant (CPP) users have driven industrial consumers towards the national grid or alternative fuels. Moreover, gas offtake by the power sector has decreased significantly, from 66% to 33%, over the past few years, leading to a reduction of 150 MMCFD in consumption. The drop is attributed to greater reliance on solar energy and other alternative fuels, which are reducing dependency on expensive RLNG. SNGPL also explained that curtailment of indigenous gas supplies is due to 1,000 MMCFD of RLNG being locked under firm government-to-government agreements. Failure to lift the committed volume could result in heavy take-or-pay (TOP) penalties and potential sovereign default. Meanwhile, demand for RLNG has dropped owing to reduced consumption by CPP users and the power sector. Curtailment of indigenous gas has also been undertaken to maintain system integrity.
Business Recorder
22-04-2025
- Business
- Business Recorder
SSGCL files plea for price increase
ISLAMABAD: The Sui Southern Gas Company Limited (SSGCL) filed an amended petition for raise in natural gas price for fiscal year 2024-25. The company filed a petition with the Oil and Gas Regulatory Authority (OGRA) on November 29, 2024 and submitted an amended petition on March 26, 2025, seeking the determination of its Estimated Revenue Requirement (ERR) for the financial year 2025-26 under Section 8(1) of the Oil and Gas Regulatory Authority Ordinance, 2002, and Rule 4(2) of the Natural Gas Tariff Rules. According to an OGRA spokesperson, the SSGCL has proposed an average prescribed gas price of Rs1,801.86 per MMBTU, compared to the previously approved rate of Rs1,762.51 per MMBTU for the FY 2024-25 Revised Estimated Revenue Requirement (RERR). Moreover, the SSGCL has also claimed previous year shortfall up to FY 2022-23 at Rs498,764 million (i.e., Rs2,335.63 per MMBTU). Additionally, the company has claimed a Re-Gasified Liquefied Natural Gas (RLNG) cost of service at Rs57.04 per MMBTU. The spokesperson further stated that OGRA will evaluate the petition and announce its decision after conducting a detailed review in accordance with regulatory procedures and standards of prudence. Copyright Business Recorder, 2025
Express Tribune
26-01-2025
- Business
- Express Tribune
Costly and scarce
Listen to article Natural gas is not just getting dearer, it is in extremely short supply too. Last month, the Pakistan Bureau of Statistics revealed that gas prices had increased by a staggering 850% in just four months. And just days later, Ogra approved yet another raise in the prices of the commodity – 25.78% in the case of SSGCL and 8.71 per cent in the case of SNGPL. However, even this costly natural gas is not available to consumers for more than 12 hours a day. While the situation is more or less same across the country, both in terms of cost and supply, the province of Sindh feels being wronged more than all others, given that it has a 61% share in the amount of gas generated in the country. Raising the issue of gas loadshedding in Sindh on the floor of the provincial assembly last week, a legislator from the ruling PPP demanded the province's share of gas supply in line with its needs. The legislator, Heer Ismail Soho, insisted that the Constitution guarantees indigenous right on resources. Ms Soho also found support from legislators belonging to other parties, including JI and MQM-P, as she presented an adjournment motion, calling upon the federal government to give Sindh its due share of the natural resource. The same issue reverberated in the Senate also about a month back. According to official statistics, Sindh receives 285mmcfd gas as against its need of 400mmcfd, meaning a shortfall of 115mmcfd or around 29%. Depletion of reserves is indeed one reason for supply shortfall, as relevant officials argue; but there are other factors also that compel loadshedding, including: poor supply infrastructure, increasing volume of UFG (unaccounted for gas) losses, undue priority to CNG stations, etc. Focusing upon the mentioned factors will at least help cut down on gas loadshedding, if not doing away with it completely.
