SNGPL, SSGC seek further hike in gas tariff

Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGC) have submitted applications with the Oil and Gas Regulatory Authority (Ogra), requesting increase in gas tariff by Rs 46 per Million British Thermal Unit (mmbtu) and Rs 43.80 per mmbtu, respectively for the upcoming financial year (2013-14).
The regulator a few days ago had enhanced gas selling price for both the companies by up to 9 percent. According to a petition filed by SNGPL, the company has asked the regulator to allow it to charge from gas consumers Rs 10 billion on account of Unaccounted for Gas (UfG) @ 7 percent. In accordance with the orders of Lahore High Court (LHC), Ogra has fixed UfG at 4.5 percent, while the gas utilities are now asking the regulatory authority to fix UfG at 7 percent.
SNGPL has estimated that it would be selling gas worth Rs 234 billion in the upcoming financial year and if the regulator allows SNGPL to collect Rs 10 billion from consumers on account of UfG, the company still has to face an estimated loss of Rs 4.680 billion. The company has estimated that its total income during the next financial year would remain at Rs 256.85 billion against its total estimated expenditures worth Rs 269.810 billion. The company would require Rs 25 billion on account of operating expenditure. As per the formula, the company's profit during the next financial year would be Rs 15.250 billion. The company has pleaded that to meet its expenditure and profit targets it would face a revenue shortfall of Rs 28.340 billion. On this ground the company has requested the regulator to approve an increase of Rs 46 per mmbtu in gas sale price for the SNGPL so that it could achieve the set targets.
SSGC has asked the regulator to allow it to charge from the gas consumers Rs 8 billion on account of UfG. The company has informed Ogra that in next financial year it would earn Rs 152 billion from gas sale. If the regulator allows SSGC to charge Rs 8 billion on account of UfG, the company will still be facing UfG loss of Rs 2.2.470 billion.
The company has estimated its total income at Rs 181.330 billion during the next financial year against its total estimated revenue earning of Rs 176.120 billion As per the formula, the SGGC would earn a profit of Rs 12.660 billion during the next financial year. It has requested the regulatory body to approve an increase of Rs 43.8 per mmbtu, otherwise, the company will face a revenue shortfall of Rs 14.8 billion.