Oil and Gas Regulatory Authority (Ogra) on Friday issued a notification to cut the price of regasified liquefied natural gas (RLNG) by around 21 percent for September, reported 24NewsHD TV channel.
According to details, the reduction applies to sales by the two Sui gas companies at the distribution stage. Cheaper LNG cargoes from Qatar mainly drove the decline.
The latest notification shows a sharp drop from August. The September RLNG price is also 47% lower than July.
At that time, Pakistan bought five costly cargoes from the international spot market after supply disruptions linked to the US-Iran conflict.
The lower RLNG price could reduce fuel costs for power producers. The average delivered ex-ship (DES) LNG price fell to $10.06 per million British thermal units (mmBtu) in September. It stood at $12.12 per mmBtu in August and $18.96 per mmBtu in July.
Meanwhile, the price for SNGPL at the transmission stage fell 19.99% to $13.99 per mmBtu in September. It was $17.49 per mmBtu in August. At the distribution stage, SNGPL’s price dropped 20.14% to $15.196 per mmBtu from $19.02.
Similarly, SSGCL’s transmission-stage price declined 21.53% to $12.611 per mmBtu. It stood at $16.07 per mmBtu in August. At the distribution stage, the price fell 21.57% to $14.22 per mmBtu from $18.13.
However, supply-chain costs continue to raise the final RLNG price. Public-sector entities add margins and other costs before the gas reaches consumers. As a result, SSGCL’s distribution price remains about $3.3 per mmBtu above the average DES price. SNGPL’s price remains around $4.2 higher.
Both LNG importers, Pakistan State Oil (PSO) and Pakistan LNG Ltd (PLL), as well as port authorities, charge margins and retainage costs. These charges amount to 3.77% of the DES price. In addition, SNGPL records system losses of 8.97%, while SSGCL reports losses of 12.55%.
SSGCL serves consumers in Sindh and Balochistan. Its distribution losses have increased from around 10.6% last year to 12.55%. Meanwhile, SNGPL supplies Punjab and Khyber Pakhtunkhwa. Its distribution losses have also risen to nearly 9% from 7.47% in October last year.
Reporter: Awais Kiyani