Ogra seeks up to 221pc hike in gas tariff from Jan 1.

Byline: Khaleeq Kiani

ISLAMABAD -- The Oil and Gas Regulatory Authority (Ogra) has asked the government to increase prices for gas consumers by up to 221 per cent with effect from January 1, 2020 to generate about Rs40 billion in additional funds required by the two gas utilities.

In two separate judgments forwarded to the government, the regulator determined about 13pc (Rs82 per unit) increase in average prescribed price to Rs707 per unit for Sui Northern Gas Pipelines Ltd (SNGPL). This would generate more than Rs30bn addition revenue to the company over the next six months.

Likewise, the regulator determined an increase of 8pc or Rs57per unit in prescribed price for Sui Southern Gas Company (SSGC) to Rs795 per million British thermal unit (mmBtu). The Karachi-based gas utility is estimated to get about Rs8bn additional revenue between January 1 and June 30, 2020.

Under the current practice, the prescribed price of SNGPL is applicable at a uniform rate across the country including for SSGC. The effective average rate thus works out at Rs707 per unit instead of the existing Rs629.

The regulator said its revenue determinations for the two companies did not involve previous year adjustments but the government could add those amounts to revenue requirements and hence the need for average prescribed price fixation at Rs785 per mmBtu, instead of Rs707 per unit. In that case, the average would have to be increased by 25pc (Rs156 per unit) instead of 13pc.

The government has already hiked gas prices by up to 143pc in September 2018 and up to 191pc this July.

The regulator proposed more than 192pc increase in the price of domestic consumers using 50 cubic meters per month to Rs353.46 per mmBtu from existing Rs121 per unit. Likewise, an increase of about 18pc has been worked out for such consumers using up to 100 cubic metres per month.

On the other hand, Ogra has worked out a reduction of about 4pc for domestic consumers using less than 300 cubic meters. The rate for up to 200 cubic meters would come down to Rs530 per unit and Rs707 per unit for up to 300 cubic meters.

The rates for high-end domestic consumers has been determined to rise 15pc to Rs1,273 per unit for consumption up to 400 cubic metres per month and to Rs1,680 for over 400 cubic meters.

Likewise, Ogra has proposed more than 221pc increase in gas rates for all categories of special commercial consumers (roti tandoors except 32pc increase for those using more than 300 cubic metres per...