Islamabad - Prime Minister Imran Khan didn’t approve the recommendation of OGRA, Petroleum and Finance Division for increase in prices of Petroleum products, keeping the POL prices unchanged and maintain the petroleum prices of August for the month of September

The Prime Minister said that people were already facing high food inflation and needed some reprieve, especially because of heavy rains. He further underlined that government would have to forego Rs. 17 billion in taxes which would be given as subsidy to people to moderate their burden.

However the government increased the price of indigenous liquefied petroleum gas (LPG) by Rs 18.38 per 11.8/kg cylinder for the month of September

There will be no change in the prices of petroleum products for the month of September and petroleum prices of August would remain the same for the upcoming month, said a notification issued by Finance Division.

The finance division didn’t issue any further detail of how much decrease or increase was recommended by Ogra. For the month of September the prices of Motor Spirit (MS-Petrol-92 RON) will be Rs 103.97 per litre HSD Rs 106.46 per litre, SKO Rs 65.29 per litre and the price of LDO Rs 62.86 per litre.

The government started collection of Gas infrastructure Development Cess (GIDC) and the first installment of the cess from Industrial and commercial consumers would be completed in September.

LPG price increased by Rs18.38 per 11.8/kg cylinder

Various sectors including fertilizer companies, government power companies, IPPs, K-Electric, general industry, gas companies owe Rs 523.60 billion Gas infrastructure Development Cess and the government will collect the amount in 24 installments.

The collection of first installment will be completed in September 2020 and this amount will be used in the development of gas infrastructure projects in the country, said a spokesperson of the Petroleum Division.

As of June 30, 2020, the total GIDC has reached Rs 523.60 billion and as per the Supreme Court directive, the petroleum division had already issued instructions to gas suppliers to collect GIDC arrears.

Following the Supreme Court of Pakistan decisions to collect GIDC from various sectors the petroleum division has directed various gas suppliers to collect the arrears from the fertilizer Industry, GENCOs, IPPs, general industry, CNG sector, K-Electric. These sectors started collection of GIDC from their consumers in 2012 but were not deposited to the national exchequer and even after the Supreme Court’s decision some consumers were trying to delay the payments on various pretexts.

The suppliers of the gas includes Sui Southern Gas Company Limited, Sui Northern Gas Pipelines Limited, Pakistan Petroleum Limited, OGDCL House, Mari Gas Company Limited

The petroleum division asked the gas providers to recover the arrears accrued up to 31st July 2020 in 24 installments from all defaulting consumers. The Supreme Court had also set the deadline for starting the collection of the GIDC arrears from Aug 1.

There will be no LPS (Late Payment Surcharge) on the arrears except where the consumer defaults on an installment. Further the gas bills for the month of August 2020 and onwards will not include or reflect GIDC rates and will remain unbilled till further orders.

As per the documents Sui Southern Gas Company Limited will collect Rs226.47 billion, Sui Northern Gas Pipelines Limited Rs150.71, Pakistan Petroleum Limited Rs10.24 billion, OGDCL Rs6.84 billion and Mari Gas Company Limited Rs129.31 billion.

The Fertilizer industry owes the highest amount of Rs195.93 billion, Industries Rs50.54 billion, IPPs Rs10.54 billion, KE Rs 40 .33 billion, Gencos Rs27.70 billion, CNG sector Rs83 billion, FFC feed Rs24.82, Captive power Rs116 billion, ENGRO Rs2.47 billion, Textile Rs17 billion, Foundation Power Company Dharki Rs2.25 billion and Pakistan Steel Rs2.65 billion.

Till the beginning of June the GIDC arrears was Rs456.94billion but increased to Rs523.60 billion by the end of June 2020. The GIDC for the month of July 2020 is not yet calculated, the documents reveal.