Government Reduces RLNG Prices for SNGPL and SSGC Consumers

The federal government of Pakistan has recently made a significant decision regarding the pricing of re-gasified liquefied natural gas (RLNG). On Friday, it was announced that the average sale prices of RLNG for consumers of both Sui Northern Gas Pipeline Company Limited (SNGPL) and Sui Southern Gas Company (SSGC) would be reduced by up to 7.11 percent for the month of October 2024. This change is expected to have a positive impact on consumers, as it reflects a decrease in the delivered ex-ship (DES) price of RLNG.

According to the Oil and Gas Regulatory Authority (Ogra), the price for SNGPL customers has been lowered by $0.9167 per million British thermal units (mmBtu), which translates to a 6.62 percent reduction. Meanwhile, SSGC customers will see a price cut of $0.9546/mmBtu, or 7.11 percent, compared to the prices set in September 2024. This is a notable shift, especially considering that in September, the government had only reduced the RLNG price by 1.07 percent.

The new weighted average sale price for SNGPL customers is now set at $12.939/mmBtu, while SSGC customers will pay $12.4659/mmBtu. To put this into perspective, in September, the prices were $13.856/mmBtu for SNGPL and $13.4205/mmBtu for SSGC customers. Interestingly, the RLNG prices for October 2024 are slightly higher than those from the same month last year, when SNGPL's price was $13.333/mmBtu and SSGC's was $13.8716/mmBtu.

It is important to note that the revised RLNG prices take into account various charges, including those related to LNG terminals, transmission losses, port fees, and margins for state-owned importers such as Pakistan State Oil (PSO) and Pakistan LNG Limited (PLL). The new rates are based on eight cargoes imported by PSO and one by PLL for the month of October.

This reduction in RLNG prices is a welcome relief for consumers, especially in a time when energy costs can significantly impact household budgets. It reflects the government's ongoing efforts to manage energy prices and ensure that consumers are not overburdened. As the energy landscape continues to evolve, it will be crucial for the government to maintain transparency and keep the public informed about any future changes in pricing. Ultimately, these adjustments not only affect the economy but also the daily lives of citizens, making it essential for the government to strike a balance between cost and accessibility.