ISLAMABAD: With system losses touching a record 16.16 per cent, the Oil and Gas Regulatory Authority (Ogra) on Friday notified up to 2.7pc reduction in the sale price of Regasified Liquified Natural Gas (RLNG) for two Sui gas companies — SSGCL and SNGPL — for the current month.
Through a belated notification, Ogra approved an increase in unaccounted-for gas (UFG) loss for SSGCL from 13 to 16.16pc and from 8pc to 8.6pc for SNGPL.
While the regulator did not explain its approval for allowing higher UFG losses for both companies, the RLNG consumers would be paying up to 16pc higher charges than the gas they actually receive.
According to notification, the RLNG’s sale price for Lahore-based Sui Northern Gas Pipelines Limited (SNGPL) at the transmission stage has been reduced by 3.26pc to 11.966 per million British thermal unit (mmBtu) against $12.37 per mmBtu in November.
The sale price at the distribution stage for SNGPL was cut by 2.72pc to $12.90 per mmBtu for December from $13.26 per unit in November.
Approves historic 16.16pc unaccounted-for losses to SSGC
Likewise, the RLNG sale price for Karachi-based Sui Southern Gas Company Ltd has been slashed at the transmission stage by 6pc to $10.54 per mmBtu against $11.22 last month. The sale price at the distribution stage for the company was decreased by just 1.99pc to $12.54 per mmBtu for December against $12.8 last month. The significant difference between transmission and distribution is mainly due to high losses during distribution.
The overall reduction in absolute terms for SSGC’s transmission price amounted to $0.675 per mmBtu and $0.255 per unit at the distribution point. The decrease in RLNG price for SNGPL at transmission stood at $0.40 per mmBtu and $0.36 per unit for distribution.
Ironically, the RLNG distribution prices of $12.54 and $12.90 per mmBtu for SSGCL and SNGPL are almost $3.97 and $3.6 higher than Pakistan State Oil’s $8.93 per mmBtu average delivered price ex-ship (DES), respectively. This is mainly because both the LNG importers — PSO and Pakistan LNG Ltd (PLL) — and port authorities also charge profit margins on account of retainage and margins at the rate of 3.15pc and 3.1pc of DES price, respectively, on top of 10.13pc losses of SNGPL and 16.16pc losses of SSGCL.
The basket RLNG price was based on 12 cargoes for December. These included 10 cargoes under the two LNG contracts between PSO and Qatar Gas at an average of $8.93 per mmBtu — four cargoes at $7.5 and six cargoes at $9.87 per mmBtu. Another cargo imported by PLL was delivered ex-ship at $8.966 per mmBtu. The average price for 10 PSO cargoes stood lower than that of PLL.
Ogra said it had decreased the prices in line with policy guidelines issued by the federal government through the Ministry of Energy.
Published in Dawn, December 21st, 2024
