ISLAMABAD: The Oil and Gas Regulatory Authority (OGRA) has made significant determinations regarding the Review of Estimated Revenue Requirement (RERR) for Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL) for the fiscal year 2023-24.
This decision, made under Section 8(2) of the OGRA Ordinance, 2002, has been forwarded to the federal government for advice on category-wise natural gas sale prices, as mandated by Section 8(3) of the OGRA Ordinance.
According to OGRA, the SNGPL has been allowed an average increase in gas prices of 36 percent, while SSGCL is permitted a five percent increase.
For SNGPL, the average gas price has risen by Rs445.19 per million British thermal units (mmbtu), from the existing average of Rs1,228.63 per mmbtu to Rs1,673.82 per mmbtu. This adjustment aims to meet the revenue requirement of Rs592 billion for the fiscal year 2023-24.
Similarly, OGRA has authorised SSGCL to raise average prescribed prices by Rs64.68 per mmbtu, from Rs1,401.72 to Rs1,466.40 per mmbtu, to meet the revenue requirement of Rs309 billion for the same period.
The total revenue requirement for both gas companies has been recommended at Rs901 billion.
The federal government has been requested to provide advice on category-wise sale prices based on these determinations. Any revisions suggested by the federal government will be duly notified by OGRA. Until then, the existing category-wise natural gas sale prices will remain in effect.
This decision is expected to have a significant impact on consumers and the energy sector at large, prompting discussions on affordability and sustainability in the use of natural gas resources.
Copyright Business Recorder, 2024
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