Sui Northern Gas Pipeline Limited (SNGPL) has sought a Rs 40 mmbtu increase in gas price, Business Recorder has learnt. Sources said that in a petition submitted to Ogra on October 15, 2010, SNGPL sought an increase in gas tariff by Rs 40 per mmbtu.
"Ogra is expected to conduct public hearing on the petition on November 15, 2010 prior to giving its verdict," sources said, adding that all stakeholders including CNG, textile and other industrial sectors will be invited to participate. After the hearing, Ogra will submit its decision to federal government, which is bound to notify the revised price within 40 days of the decision effective January 1, 2011.
Earlier, SNGPL had sought hike in gas tariff by Rs 37.25 per mmbtu for each category of consumer on account of cost of gas, Central Excise Duty and Transmission and Distribution (T&D) cost to meet revenue shortfall of Rs 23.598 billion. Ogra conducted a re-hearing of the review petition submitted by SNGPL on October 7, 2010 but the decision has not yet been taken.
In one more petition, SNGPL had prayed to raise gas tariff by Rs 2.43 per mmbtu, which was turned down by Ogra. In its decision, the Authority also decided to revise downwards the average prescribed price by Rs 2.93 per mmbtu. However, benchmark of the Unaccounted for Gas (UFG) had been raised to 7 percent against the upper and lower target of 5.50 percent and 4.50 percent, respectively, fixed by Ogra. The UFG has been reported at 8.68 percent (57,444 mmscf) and SNGPL had requested fixing UFG target at 7.5 percent for three years in its review petition submitted to Ogra.
Analysts said that Ogra had given undue favour to SNGPL by raising UFG benchmark to 7 percent rather than reducing it which would have enabled the gas utility to improve its system to stop gas leakage and theft. When contacted, All Pakistan CNG Association said it opposed any increase in gas price to cover gas shortfall and the main reason behind it was gas theft. He said Ogra had raised UFG from 5 to 7 percent for SNGPL, which will be a burden on consumers.