Captive Industry Faces Gas Price Increase as OGRA Issues Notification
Staff Report
ISLAMABAD:
The federal government has approved a selective revision in gas sale prices, increasing rates exclusively for the General Industry (Captive) category while retaining prices for all other consumer groups.
The Oil and Gas Regulatory Authority (OGRA) has officially notified this adjustment, effective February 1, 2025.
The gas price for the Captive Industry has been revised from Rs. 3,000/MMBTU to Rs. 3,500/MMBTU. However, categories such as Domestic, Special Roti Tandoor, General Industry (Process), Commercial, CNG, Cement, Fertilizer, and Power will continue to pay the same rates.
The federal government’s decision follows OGRA’s determinations in the Review of Estimated Revenue Requirement for FY 2024-25 for Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL). Despite OGRA’s earlier recommendation to increase gas prices across the board to address the gas sector’s circular debt and generate Rs. 847.33 billion in revenue, the government opted for a focused hike targeting the Captive Industry.
OGRA’s initial proposal had called for an increase of Rs. 142.45/MMBTU for SNGPL consumers and Rs. 361/MMBTU for SSGCL consumers, with flat rates of Rs. 1,778.35 and Rs. 1,762.51 per MMBTU, respectively. These hikes represented an 8.71% increase for SNGPL consumers and a 25.78% increase for SSGCL consumers.
Under the revised law, the government is required to set category-specific rates while adhering to OGRA’s calculated revenue requirement. In this instance, the rates for most consumers remain unchanged, reflecting an effort to balance financial sustainability within the gas sector without imposing significant additional burdens on the majority of users.
The Captive Industry refers to industrial units involved in power production for self-consumption or selling surplus power to distribution companies or bulk-power consumers.
This adjustment aims to address sector-specific challenges while ensuring uninterrupted energy supplies, highlighting the government’s commitment to balancing industry sustainability and consumer affordability.
