ISLAMABAD: The Supreme Court in its reserved judgement on Compressed Natural Gas (CNG) pricing that it announced on Friday directed Oil and Gas Regulatory Authority (Ogra) to come up with a consumer-friendly pricing formula after consultation with all the stakeholders. A two-judge bench of Justices Jawwad S Khawaja and Khilji Arif Hussain ordered that the current CNG price would remain in effect till a new pricing formula was worked out by Ogra.
In its short order, the bench held Ogra responsible for inflated CNG price and observed that the Authority failed to protect consumer rights because of a collusion between the government, CNG station owners and Ogra. The verdict was issued on identical petitions filed by Eng. Iqbal Zafar Jhagra, Senator Rukhsana Zuberi and an application filed by Sannaullah Bhutta. The petitioners raised a number of issues on petroleum and natural gas pricing. The petitioners contended that the price at which CNG was being sold was not in accordance with the law.
The bench noted that various items in the present formula appeared to have been arbitrary in nature and not in accordance with law and without any reference to accounts of CNG stations. The short order noted: "The operating cost of CNG stations was admittedly calculated as per the MoU singed between CNG Association and federal government. Upon examination, the MoU held on August 25, 2008 had been entered into by the government of Pakistan and the All Pakistan CNG Association, CNG Dealers Association and CNG station owners....this MoU purported to fix the price of CNG in the whole country for a certain period and was subject to revision, through identical consultative process between the parties on bi-annual basis".
The short order further maintained that fixing the CNG sale price in this manner was a clear violation of law and Ogra, "which bears the primary responsibility in this area, was not a party to the MoU." The order noted that instead of intervening to protect the public interest, Ogra simply chose to enforce the MoU, which was a "blatant abandonment of its duties and abdication of its statutory role as protector of the interests of the citizens who have to bear the brunt of the unjustifiable prices".
The court further observed: "We note with great regret that throughout these hearings on issues of the greatest public importance, the approach of the executive authority which shares with Ogra the responsibility for sorting out this matter of highest significance, has not been helpful. "The questions relating to UFG losses and other issues raised in the Constitution petitions will be considered at the next hearing."