SSGC seeks 15.38% increase in gas prices for current fiscal year

• SSGC seeks hike to offset rising costs of gas, other components.
• Petition includes Rs13.45 per MMBtu for LPG air-mix projects.
• Ogra invites comments from all interested, affected parties.

ISLAMABAD: The Sui Southern Gas Company (SSGC) once again sought a 15.38% increase in gas prices for the ongoing fiscal year in a bid to offset the rising costs of gas and other components, The News reported Wednesday. 

In its petition filed with the Oil and Gas Regulatory Authority (Ogra), SSGC has urged the revision of the rate from the existing Rs1,470.21 per MMBtu to Rs1,696.39 per MMBtu — an increase of Rs226.18 per MMBtu — from July 1 of the current financial year. 

The company’s petition to Ogra outlines an estimated revenue requirement of Rs47.773 billion for FY24.

The average prescribed price is predominantly composed of the cost of gas, representing over 85% of the determined price.

The Karachi-based gas utility highlights that the cost of gas is linked to the international price of crude oil/fuel oil, as per agreements between the federal government and gas producers. Additionally, SSGC has calculated the cost of RLNG’s service at Rs48.8 per MMBtu for FY2023-24.

Significantly, the company’s petition includes Rs13.45 per MMBtu for the LPG air-mix projects and Rs95.40 per MMBtu to be recovered from consumers to counteract revenue shortfalls from Balochistan province.

Simultaneously, SSGC has filed another petition for the revision of the security deposit of domestic (system gas & RLNG) consumers. In this petition, the company proposes revising the gas supply deposit (GSD) based on the highest three months of consumption during the year. The recovery of the gas supply deposit shortfall from domestic consumers will occur over six months in equal instalments.

The petition notes that currently, only 1.697 million out of 3.186 million domestic consumers, or 53%, are secured with their gas supply deposit. Meanwhile, 1.426 million domestic consumers are unsecured, with a GSD shortfall of Rs9.579 billion against the required GSD of Rs15.019 billion.

In response to these petitions, Ogra has invited comments from all interested and affected parties, including gas consumers and the general public. A public hearing on the petition is scheduled on December 18, 2023, in Karachi, during which the regulatory authority will determine the gas prices.