SNGPL expects profits to exceed target by Rs280 million

SNGPL expects profits to exceed target by Rs280 million

Friday, April 6, 2012: Sui Northern Gas Pipelines (SNGPL) has expected to make Rs280 million more than its financial projections in the next financial year.

For the very reason, gas providers have asked the regulator to decrease gas prices for consumers as they estimate to make revenue slightly more than their requirement.

As per the revised appeal filed by SNGPL and Sui Southern Gas Company, gas companies have sought a nominal decline of Rs2.01 per Million British Thermal Unit (mmbtu) in gas prices from July 1, the new financial year. The two companies
had earlier sought a decrease of Rs13 per mmbtu in gas prices but revised it after redoing the math.

SNGPL in its altered petition says that due to increase in oil prices and variation in rupee-dollar parity, the surplus in the revenue requirement dropped massively from Rs264,558 million but still stood at Rs280 million more than
its ideal level.

The other reason for the drop and not an increase in gas prices is that gas companies are on track to meet its financial projection for the current financial year. An increase is sought to recover or make up for the shortfall persisted
in the previous financial year. SNGPL has recovered shortfall of Rs3.07 billion in the ongoing financial year 2012.

SSGC had filed a petition on November 30, 2011 for determination of its revenue requirement for financial year 2013 at Rs159,594 million. The petitioner had also requested an additional amount of Rs248 million on account of air-mix
LPG project that will cause a decrease in the surplus revenue to Rs3,291 million.

SSGC filed an amended petition on March 22, 2012 in view of increase in oil prices and rupee-dollar parity during November 2011 to March 2012 with 0.75% monthly escalation. Resultantly, the surplus in revenue has been decreased
to Rs995 million excluding subsidy of Rs248 million for air mix LPG project, saying that the remaining surplus of Rs747 million revenue be adjusted by decreasing prescribed price by Rs2.01 per mmbtu effective from July 1.

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Posted by Wajahat Javed on Apr 7 2012. Filed under Business, Pakistan. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry