ISLAMABAD: Oil and Gas Regulatory Authority (OGRA) has clarified that the news item that had claimed increase in gas prices by 36 percent was not true and gas consumers were not being burdened with Rs. 341 billion.
An OGRA spokesman has stated that no increase in the gas price for domestic as well as fertilizer feedstock gas was proposed. He further clarified that determination of natural gas sale price falls under the jurisdiction of Federal Government, and instant decisions for FY 2016-17, referred to in a section of press, determines only the prescribed prices.
Spokesman further explained that OGRA has issued its decisions against SSGCL & SNGPL petitions for determination of prescribed price for FY 2016-17 on October 06, 2016. In case of SSGCL, OGRA has slashed down its demand by 82.54/MMBTU effective July 2016, and determined the average prescribed price at Rs. 354.24/MMBTU. In case of SNGPL, OGRA has determined its average prescribed price at Rs. 480.63/MMBTU as against company’s demand of Rs. 480.34/MMBTU.
It is, however, pertinent to mention that a decrease of over Rs. 60/MMBTU and Rs. 30/MMBTU has been determined by OGRA over prescribed price of FY 2015-16 of SSGCL & SNGPL respectively. In view of the same, contention of gas price hike by 36 percent in current financial year is denied.
The decisions have now been sent to Federal Government that shall advice category-wise natural gas sale prices, considering its socio economic agenda, within forty days to OGRA. The sale prices as advised by Federal Government shall be notified by OGRA and then be charged to natural gas consumers.
It is further clarified that SNGPL and SSGCL, as per their license conditions, are entitled to retain 17.5 percent and 17 percent return on their net operating fixed assets respectively.
Accordingly, return on assets amounting to Rs. 19.063 billion and Rs. 9.718 billion have been provisionally allowed to SNGPL and SSGCL respectively for FY 2016-17 as against the reported figures of Rs. 39.5 billion (for SNGPL) and Rs. 35.4 billion (for SSGCL). Moreover, inclusion of financial cost in creation of RLNG infrastructure as part of prescribed price for FY 2016-17 is denied. OGRA has provisionally allowed Rs. 22.172 billion and Rs. 22.045 billion for SNGPL and SSGCL in respect of infrastructure development relating to RLNG assets as against the demand of Rs. 46.277 billion and Rs. 44.443 billion respectively. It is, however, clarified that natural gas consumers shall not be burden as they are protected under the ring-fencing. Detail discussion and decision is available on OGRA’s official website (www.ogra.org.pk). —INP
