ISLAMABAD: The government has decided to keep the prices of natural gas unchanged to partially offset losses of gas companies, rejecting the Oil and Gas Regulatory Authority’s (OGRA) recommendation for 2-6 per cent reduction in the rates, a national daily reported.
The regulator was conveyed that on completion of mandatory 40-day deadline prices will remain unchanged for the time being. “There is no need for a fresh notification,” an official of the authority told media. OGRA had also suggested that the government reconsider adjustment of some of the previously outstanding revenue requirements.
On July 14, OGRA had determined 2-6 per cent reduction in the prescribed prices of two gas utilities for fiscal year 2020-21 to pass on partial impact of decline in international oil prices to gas consumers. It had sought an advice from the government on gas sales price for each category of consumers.
Under Section 8(3) of the OGRA law, the federal government is required to advise the regulator within 40 days the minimum charges and the sale price for each category of retail consumers for notification in the official gazette. The managements of SSGCL and SNGPL had claimed that they were going under due to prior year outstanding adjustments that were approved by the regulator as legitimate heads but could not be notified by the government and the OGRA.
The regulator had declined to allow those allowances again in revenue requirement for FY2020-21 since these belonged to years for which it had separately determined revenue requirements but asked the government to consider a way out to clear backlog including through provision of subsidy from the budget, the newspaper reported.