SSGCL Proposes Significant Increase in Prescribed Gas Prices from July 1:
The Sui Southern Gas Company Ltd (SSGCL) is seeking to increase its prescribed prices by Rs392 per million British thermal units (mmBtu) from July 1 to address its revenue shortfall of about Rs98bn for 2023-24, following a recent hefty increase in natural gas prices for consumers.
The Oil and Gas Regulatory Authority (Ogra) announced on Thursday that it had accepted the petition for a public hearing.
SSGCL estimates its total revenue requirement for the next fiscal year at Rs266bn.
However, its sales revenue under the existing prescribed price would only generate Rs168bn, creating a gap of Rs98bn.
To bridge this gap, SSGCL needs to increase the prescribed price by Rs392 per unit.
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Additionally, the company claims another revenue shortfall of about Rs15bn due to losses in the supply of Regasified Liquefied Natural Gas (RLNG) during the next fiscal year, and it is demanding an increase of Rs32.62 per unit in additional prescribed prices to meet the requirements of RLNG supplies.
The government has already increased consumer gas prices by up to 124% to address the revenue shortfall of two gas companies during the current fiscal year.
The prescribed prices approved by Ogra require the government to pass on the impact to various consumer categories while considering sociopolitical priorities.
The law requires consumer-end gas prices to be revised twice a year.