Jan 29, 2021: Oil and Gas Regulatory Authority has ‘provisionally’ determined the Sui Southern Gas Company (SSGC)’s shortfall in estimated revenue requirement for the fiscal year 2020-21 at Rs14,270 million including ‘prior year shortfall of Rs50,983 million.”
“Accordingly, the prescribed price at Rs778.59 per MMBTU [Million British Thermal Unit] has been determined by the authority against each category of the [gas] consumer as determined u/s 8(2) of the Ordinance,” the authority said in its 32-page decision while disposing of the company’s review petition for the Estimated Revenue Requirement for the year 2020-21.
OGRA was of the view that all the classes of consumers should at least pay the average cost of service or the average prescribed price except wherever the federal government guidelines had been provided, which would be implemented accordingly.
It said the revised provisional prescribed price determined against each category of consumers was subject to the condition that these “maybe readjusted upon receipt of the federal government advice under Section 8 (3) of the Ordinance in respect of the sale price of gas for each category of retail consumers so that the petitioner [SSGC) is able to achieve its revenue requirements in accordance with Section 8 (6) (f) of the Ordinance.”
Accordingly, OGRA said, the federal government was required to advise the authority, “within 40 days of advice from the Authority of revision of prescribed prices,” the minimum charges and the sale price for each category of retail consumers, for notification in the official gazette by the authority.
OGRA asked the SSGC to focus and make concerted efforts on reduction of Unaccounted for Gas (UFG), improvement of internal control systems, increase of efficiency, quality of service, and emergency response plan. It also advised the company to take effective cost control and reduction measures to remain financially viable instead of “making all-out efforts to seek to pass on costs associated with its own inefficiencies, malpractices, thefts, bad debts and alike to the consumers. “
Meanwhile, OGRA spokesman Imran Ghaznavi said the authority had determined “the revised prescribed price at Rs 778.59/MMBTU i.e. 5.4% increase. Current sale price is at higher side resulting in no impact on price.”
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