ISLAMABAD: The Oil and Gas Regulatory Authority (Ogra) has dropped a bombshell by increasing the gas tariff by 36 percent in the current financial year 2016-17, owing to which the end consumers will pay a mammoth amount of Rs341 billion more to the gas companies.
Official documents available show that the regulator has increased the gas price for the Sui Northern Gas Private Limited (SNGPL) by Rs57.89 per MMBTU and decreased the gas price for Sui Southern Gas Company Limited (SSGCL) by Rs60.12 per MMBTU.
The increase in gas price will be applicable in the ongoing fiscal year. As per the formula of the federal government, the increase in gas tariff determined for the Sui Northern will be applicable across the country.
The decision of the Ogra has been sent to the Ministry of Petroleum and Natural Resources seeking the advice of the federal government by November 15 on deciding the increase in gas tariff particularly for domestic consumers and generally for other categories of consumers, a top official of the regulator told The News.
The government is supposed to tell the Ogra on passing of full increase in gas price to consumers or not and if not, then it will tell how much subsidy for certain categories of consumers will be provided.
In the advice sought by the Ogra, the government is also supposed to assess as to how much direct and cross subsidy be extended to which category of consumers.
On top of that, the regulator has also passed an additional financial burden of Rs9 billion on to consumers in the wake of the expenditure to be incurred on various gas schemes that will now be initiated after the prime minister has softened the ban earlier imposed on the new gas schemes.
The Ogra has, under the PM directive, approved the 5,500-kilometre new gas schemes for parliamentarians.
The new gas schemes require Rs9 billion to get completed and the financial burden of Rs9 billion has been passed on to the end consumers.
The Ogra has finalised the operating income at Rs201 billion for the Sui Northern and operating expenses at Rs161 billion in the financial year 2016-17 for Sui Southern.
The regulator has, in nutshell, determined the operating profit for Sui Northern in the current fiscal at Rs39.5 billion. In the determination, the Ogra has fixed the revenue for Sui Northern at Rs225 billion.
The average prescribed gas price for Sui Northern has been jacked up from Rs422.74 per MMBTU to Rs480.83 and for Sui Southern, the price has tumbled to Rs354.24 per MMBTU from Rs419.36 per MMBTU.