Government Slashes RLNG Prices by 1.5% in July

 Government Slashes RLNG Prices by 1.5% in July 2023

In a move aimed at providing relief to consumers, the government has reduced the average monthly sale price of re-gasified liquefied natural gas (RLNG) by 1.5% for July 2023.

The announcement was made by the Oil and Gas Regulatory Authority (OGRA) on Tuesday.

Under the new pricing, RLNG will be sold at $12.6493/mmBtu for SNGPL customers and $13.1367/mmBtu for SSGC customers, marking a 1.5% decrease compared to the previous rate.

This reduction follows a series of rate cuts witnessed in previous months. Although the impact on electricity generating costs, particularly for RLNG-based power plants, is expected to be minor, it should be noted that the federal government has already decided to increase electricity rates from the current billing cycle.

The government has been consistently lowering RLNG costs for domestic customers since May of the previous year, except for a few months. Notably, RLNG prices in the domestic market reached their highest point in May 2022 since Pakistan began importing LNG in 2015, standing at $21.8317/mmBtu for SNGPL and $23.7873/mmBtu for SSGC.

The revised rates likely include fees for LNG terminals, port costs, and the margins of state-run importers such as Pakistan State Oil (PSO) and Pakistan LNG Limited (PLL).

This reduction in RLNG prices reflects the government's efforts to alleviate the burden on consumers and promote cost-effectiveness in the energy sector.

By implementing these measures, the government aims to create a favorable environment for trade and economic growth.