The Planning Commission has strongly opposed upward revision in Sui Northern Gas Pipelines Limited (SNGPL) gas prices and termed its demand as uncalled for and ill-timed.
The commission in its written comments on the SNGPL plea for 7.5 percent increase for all consumer categories said the Oil and Gas Regulatory Authority (Ogra) should discourage the gas distribution companies from making money through enhancing gas rates and advised them to review their strategy.
Sources told Business Recorder that the Planning Commission asked Ogra to reject the plea and suggested that it should direct the SNGPL management to focus on other areas to raise funds. It noted that SNPGL, instead of seeking increase in gas rates time and again, should make its system efficient to make raise funds for meeting developmental and non-developmental expenditures.
It wanted that the company should cut down non-developmental expenditures to the possible lowest level, besides bringing line losses down to 4-5 percent. The commission said that gas losses by the SNGPL were irrationally higher.
SNGPL filed a petition with Ogra last month, seeking 7.5 percent increase in gas rates, which is pending for public hearing.
The authority had sought comments from the Planning Commission and other gas sector stakeholders on the petition.
As per the rules, the authority will conduct public hearing into the case and take the views of all the stakeholders into consideration before final judgement.
The company termed increase in prices as inevitable for fulfilling its commitments to expand network to supply gas to new areas, besides upgrading existing system to make it more efficient.
SNGPL also said that increase in gas rates would help it in generating more funds for other big projects such as pipelines. It wants upward revision in its rates from March 1. The government increased gas rates by 15.6 percent from January 1 and SNPGL was the major beneficiary.
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