The Oil and Gas Regulatory Authority (Ogra) has convened a public hearing in Lahore to address a significant proposal put forth by Sui Northern Gas Pipeline Limited (SNGPL). SNGPL is seeking a substantial 147% increase in gas prices for the upcoming Fiscal Year 2024-25.
If this considerable price hike is approved, it could potentially trigger a noticeable escalation in the country’s inflation rates. Such a steep increase would place a heavy financial burden on households, especially impacting those with lower incomes.
SNGPL, which caters to more than 7.22 million consumers across North Central Pakistan, is currently grappling with an estimated revenue shortfall of approximately Rs189.18 billion. This deficit is a significant concern for the company and has led them to propose this substantial increase in gas prices.
The suggested hike in gas prices is planned to be implemented from July 1, 2024. The objective is to elevate the average gas price to Rs4,446.89 per Metric Million British Thermal Unit (mmbtu). This proposed rate represents an increase of Rs2,646.18 per mmbtu.
The projected price of Rs4,446.89/mmbtu takes into account the shortfalls from the previous year within the natural gas sector. Additionally, SNGPL has indicated a cost of service for regasified liquefied natural gas (RLNG) at Rs325.08 per mmbtu for the same period.
Following the Lahore hearing, Ogra has scheduled another session in Peshawar on March 27. These hearings are designed to provide a platform for stakeholders, consumers, and the general public to voice their concerns, opinions, and feedback regarding the proposed price increase.
The proposed 147% increase in gas prices by SNGPL is a matter of significant public interest and concern. The Lahore and Peshawar hearings by Ogra will play a crucial role in evaluating the proposal’s merits and potential impacts, ensuring that all perspectives are considered before making a final decision.
