Gas prices in Pakistan may increase as Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company (SSGC) have submitted applications to the Oil and Gas Regulatory Authority (OGRA) seeking higher average gas prices for the current fiscal year.

Both companies have requested that their proposed revised rates take effect from July 1 of the current fiscal year. OGRA will review the applications and conduct hearings before making a final decision.

The proposed increases could affect gas consumers across the country, depending on the regulator’s decision and any subsequent changes to consumer tariffs.

SNGPL Seeks Rs. 10.40 Increase Per MMBTU

SNGPL has requested a relatively small increase in its average gas price.

The company has proposed raising its average rate by Rs. 10.40 per million British thermal units (MMBTU). This would increase the rate from Rs. 1,702 to Rs. 1,712.40 per MMBTU.

The company has also included Rs. 60.147 billion in liquefied natural gas (LNG) service costs in its proposed gas pricing calculation. It has estimated the LNG cost at Rs. 471.16 per MMBTU.

According to its application, locally produced gas may not be sufficient to meet demand during the winter season. The company expects to require additional supplies to manage the anticipated shortage.

SNGPL estimates that it will need 16 LNG cargoes to meet demand during the period.

SSGC Requests Rs. 366.75 Increase Per MMBTU

SSGC has sought a significantly higher increase in its average gas price compared with SNGPL.

The company has proposed an increase of Rs. 366.75 per MMBTU. Under its request, the average gas price would rise to Rs. 2,071.75 per MMBTU.

Both gas utilities have referred to rising international crude oil prices as one of the factors behind their requests for higher rates.

The companies have submitted their proposals to OGRA for review. However, the requested increases have not yet been approved.

OGRA to Review Gas Price Applications

OGRA will examine the applications submitted by SNGPL and SSGC before making a decision.

The regulator is expected to conduct hearings to review the proposed costs, revenue requirements and other factors presented by the two companies.

The final decision will determine whether the requested increases are accepted, reduced or rejected.

Until OGRA announces its decision, the proposed rates should not be considered approved gas prices.

Consumers will be watching the regulator’s decision closely, particularly as gas demand is expected to rise during the winter season. Any approved changes could affect the cost of gas for households and businesses across Pakistan.

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