The Oil and Gas Regulatory Authority (OGRA) has dropped a gas bomb on the masses as it increased the tariff for consumers of two sui gas companies by up to 74%, effective from July 2022.
The regulator, in a notification issued on Wednesday, hiked the tariff of Sui Northern Gas Company Limited (SNGPL) and Sui Southern Gas Company (SSGC) for household consumers, commercial sector, tandoors, captive power plants and general industries, including export-oriented sector.
Interestingly, the regulator has abolished the earlier applicable slabs of gas consumption and their respective rates and fixed the price at 952.17 per Million British Thermal Units (mmBtu) for SNGPL consumers. Likewise, for SSGC, the prescribed prices have been fixed at Rs1161.91/mmBtu.
Having a cursory look at the decision, lower slabs who consume less and are almost poor consumers are most affected as their gas prices have tripled, while for the higher slabs, the prices have been literally reduced.
The regulator issued its decision after holding public hearings on the petitions of SNGPL and SSGC in November 2022, where both companies had demanded a substantial increase in their prescribed gas prices for the current FY23 to help them meet revenue requirements.
SNGPL, operating the gas network in Punjab and Khyber Pakhtunkhwa, sought Rs1,294.02/mmBtu, and SSGC which feeds Sindh and Balochistan sought Rs667.44/mmBtu increase.
According to the latest decision of OGRA on their petitions, the prescribed gas prices for SNGPL have been increased by 74.42% while for SSGC, it has been increased by 67.75%.
In absolute terms, for SNGPL the average price has been increased by Rs406/mmBtu to Rs952.17/mmBtu. For SSGC too, the gas price has been enhanced by Rs469/mmBtu to Rs1,161.95/mmBtu.
The regulator has sent its decision to the federal government.
Now, the government would decide on it within 40 days of this notification. If the government does not notify it, then it will automatically come into effect.
