SSGC booked Rs 30b for the LNG swap

Aftab Ahmed

Sui Southern Gas Company (SSGC) has booked Rs 30 billion to recover it in a gas bill from customers as a result of the LNG swap.

Sources told Newztodays.com that SSGC had earlier booked Rs 15 billion last year on account of an and wanted to recover a gas bill from the customers. It had jumped up now to Rs 30 billion on account of the LNG swap.

SSGC has been pressing the Oil and Gas Regulatory Authority (Ogra) to recover this in gas bill by allowing for revenue requirements. However, the regulator wanted to conduct its audit first.

Officials said that Ogra had appointed an auditor to conduct an audit and verify the claims of the SSGC.

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They said that SSGC claimed that it faced a loss of Rs 30 billion due to the LNG swap with the Sui North Gas Pipeline Limited (SNGPL). As a result, it has advocated for its inclusion in revenue requirements.

The gas utility said that it faced a loss due to the high pressure of LNG in its system. They further said that an auditor was conducting an audit to verify the claims of the SSGC.

If the auditor agrees with SSGC’s claims, Ogra will include gas usage in its revenue requirements in order to recover Rs 30 billion from gas consumers.

Pakistan now has two LNG terminals with a combined capacity of 1.2 billion cubic feet per day (bcfdd). The government had a dedicated capacity of 600 mmcfd of LNG from each LNG terminal.

Because Punjab is a gas-depleted province, it consumes a large portion of the LNG.

SSGC swapped gas from the gas fields to pump it to the Punjab province in order to transport LNG. Under a swap arrangement, SSGC uses some LNG, whereas SNGPL uses indigenous gas.

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Pakistan has 4 billion cubic feet per day of indigenous gas, but demand has increased dramatically. As a result, LNG has become a source of bridging gas shortfalls, primarily during the winter season, in order to overcome shortages.

The PML-N government has initiated LNG projects to bridge the shortfall. There are several industries that do not have an alternative fuel, such as CNG and fertilizers. Therefore, LNG helped revive these sectors.

At present, the dry docking of the Engro LNG terminal has also led to controversy as the government did not want to allow it due to the looming gas crisis.