Two state-owned gas utilities – SNGPL & SSGCL – are suffering from heavy losses as during the last four financial years (2012-2016) both the companies racked up gas losses to the tune of Rs 82 billion.
During the financial year 2015-2016, Sui Northern Gas Pipelines Limited (SNGPL) suffered UfG (Unaccounted for Gas) losses to the tune of Rs 8 billion (8,376million) and Sui Southern Gas Company Limited (SSGC) Rs 14 billion (14,548 million). In FY2014-2015, UfG of the SNGPL remained at Rs 11 billion (Rs 11,639 million), and SSGCL at Rs 10 billion (10,282 million), Rs 12 billion (12,262 million) of SNGPL and Rs 9 billion (9,944 million) of SSGCL in FY 2013-2014. And, in FY 2012-2013, the UfG losses of SNGPL registered at Rs 13 billion (Rs 13,917 million) and SSGCL at Rs 19 billion (1,920 million), official documents said.
Interestingly, OGRA has already allowed 4.5pc ratio of UfG annually to the gas companies and as a result above Rs 12 bln heavy amount is collected from the gas consumers, which is almost 2.5pc extra to the UfG ratio of India, Bangladesh and many other countries of the region. The UfG ratio in India and Bangladesh stands around 1.5pc to 3pc.
The gas consumers of both gas companies have been bearing the brunt of extra burden 4.5 per cent UfG as per OGRA’s determined benchmark. The OGRA usually sets the benchmark of UfG for both gas companies only to adjust their losses incurred in one fiscal year. The gas consumers bear the brunt of 4.5pc ratio of UfG. And, remaining losses of these companies are adjusted from their profits. More, gas theft has been causing billion of rupees worth losses per year to the exchequer. The theft includes unaccounted for gas due to tampering of pipelines and meters.
Gas theft and tampering with meters and pipelines are reportedly more prevalent among commercial, industrial and bulk consumers. The number of residential consumers had grown manifold over the years, but there was negligible amount of gas theft among domestic consumers. The theft is allegedly done in connivance with officials of these two gas utilities. And, these gas companies usually do not dare to take action against influential gas thieves because of political pressure.
Reportedly, OGRA has chided SNGPL officials for lax attitude in dealing with gas theft and termed this a violation and contempt for the rule of law. “Since the OGRA has to look after interests of all stakeholders on the basis of justice and fair play, the SNGPL management is, once again, requested to address all aforementioned issues,” OGRA said in a letter written to SNGPL managing director on January 19.
Available official documents show that the authority (OGRA) has determined the estimated revenue requirement of SSGCL for FY 2015-16 at Rs 184 billion (Rs 184,859 million) against Rs 263 billion (Rs 263,116 million) demanded by SSGCL. Similarly, it (OGRA) has determined the final revenue requirement of SNGPL for FY 2014-15 at Rs 231 billion (Rs 231,191 million) against Rs 281 billion (Rs 281,936 million) demanded by SNGPL.
It is worth mentioning here that the gas theft was made part of the Criminal Procedure Code in 2011 as a cognizable offence, but the government has increased fine and imprisonment and made it a non-bailable offence through a new bill.
