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OGRA Announces Significant Increase in Gas Tariffs

Islamabad: The Oil and Gas Regulatory Authority (OGRA) has imposed a substantial increase of 35.1% in the tariff for Sui Northern and 8.5% for Sui Southern from February 2nd.

OGRA has sent the notification for approval to the federal government for implementation. According to the notification, the average gas price for the Sui Northern Gas Pipelines Limited (SNGPL) has been increased from Rs. 1238.68 to Rs. 1673.82 per MMBTU. Sui Northern has been permitted to collect an additional Rs. 180 billion from consumers.

The average gas price for Sui Southern Gas Company Limited (SSGC) has been increased from Rs. 1350.68 to Rs. 1466.40 per MMBTU. Sui Southern has been allowed to collect an additional Rs. 48 billion from consumers.

This decision marks the second increment in gas prices within the fiscal year 2023-24. Previously, OGRA had announced a staggering 193% rise in gas prices, starting from November 1, 2023.

According to the notification, OGRA has failed to enforce gas companies to reduce gas theft. OGRA stated that gas companies have not presented a solid plan to reduce gas theft, and as a result, in the current fiscal year, Sui Northern will incur a loss of Rs. 14.77 billion due to gas theft.

OGRA has approved the imposition of a 10% surcharge on consumers to benefit the company. Earlier, the government had initiated the collection of surcharges from profit-earning companies starting from July 1, and it was instructed not to transfer the tax burden onto consumers.

Permission was also granted to Sui Northern to open an office in Karak, for which an annual expenditure of 10 crore rupees was also approved.

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