ISLAMABAD: The Oil and Gas Regulatory Authority (OGRA) has approved up to 14 percent hike in the price of gas for the ongoing fiscal year, 2014-15, official sources say.
The increase in price has been approved for all categories of gas consumers, including the domestic. The sources also said that OGRA has recommended a raise in the price of gas for the customers of Sui Northern Gas Pipelines Limited (SNGPL) by 58.29/mmbtu, raising the price to Rs 464.94/mmbtu. This hike in gas price would lead to a Rs 29 billion burden on the consumers in the ongoing financial year. A Rs 22.90/mmbtu hike has been suggested in the tariff of Sui Southern Gas Company Limited (SSGCL), which is 5% higher than the present tariff. After this raise the price of SSGCL gas will reach Rs 469/mmbtu.
A senior official at the Ministry of Petroleum and Natural Resources, who wished not to be named, said that OGRA has forwarded its decision to the Ministry of Petroleum for approval. The ministry has the powers to maintain the gas tariff for domestic consumers at current level while increasing the price for remaining categories of consumers. The official added that if the government approves the subsidy then SNGPL and SSGC will not raise the gas price. It is noteworthy that the Petroleum Ministry has already dispatched a summary to the federal cabinet’s Economic Coordination Committee (ECC) and sought approval for passing on gas losses worth Rs 49 billion to the already overburdened gas consumers of the country. The ECC is likely to take a decision on this on July 5 in its scheduled meeting under the chair of Finance Minister Ishaq Dar.
It is noteworthy that OGRA had earlier decided to increase the gas tariff of both state-owned gas utilities for the current fiscal year by 12% and 17%, respectively. The summary had been dispatched to the Petroleum Ministry for final approval. Sources at the Petroleum Ministry had told Daily Times that the regulator has determined increase in gas tariff of Sui Northern Gas Pipelines Limited by Rs 50.62 per mmbtu and Rs 73.12 per mmbtu for the Sui Southern Gas Company Limited for the outgoing fiscal year 2013-14. They said that though OGRA has determined the hike in the tariff for the outgoing financial year 2013-14, the impact of colossal raise amounting to around Rs 32 billion from a total Rs 47 billion will not affect the gas consumers.
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