ISLAMABAD - The issue of state-owned gas utilities' exorbitant demand for disallowances on unaccounted for gas (UFG) and non-recovery of bills and non-metered gas remained indecisive even after of a couple of hours heated debate in the federal cabinet.

A Cabinet member told TheNation on condition of anonymity on Thursday that the two utilities namely the Sui Southern Gas Company and the Sui Northern Gas Pipelines Limited were demanding an aggregate amount of Rs 11 billion. On the other hand, the independent regulator the Oil and Gas Regulatory Authority (OGRA) had allowed them Rs 8 billion.

According to the sources, the Petroleum Ministry, being the controlling authority of the two utilities, was insisting for allowing the demanded disallowances on account of the UFG, gas theft, non-metered and metered losses including non-recovery of bills.

On the other hand, Law Minister Farooq H Naik, and Finance Minister Abdul Hafeez Sheikh were upholding the regulator's determination.

The source said that the regulator's viewpoint was clear that it had approved the law and order and non-recovery of bills allowances for the Sui Southern Company which genuinely deserving for operating in Balochistan and Sindh. The Petroleum Ministry, he said, was of the view that denial to grant the demanded allowances would threaten the financial viability of these utilities. Therefore, the PM decided to constitute a committee sensing the gravity of the issue under the law minister Farooq H Naek and sought a report within three days.

It also merits mentioning here that further details of the meeting here that federal cabinet has declined to approve the collection of whopping Rs9billion from the gas consumers already paying gas bill regularly. Oil and Gas Regulatory Authority (OGRA), Law Minister and Finance Minister while showing grave concerns over fleecing the innocent consumers strongly opposed the summary of Petroleum Ministry once again seeking Cabinet's approval.

They said an approval pertaining collection from consumers can not granted above the set limits on account of unaccounted for gas (UfG). And, both Supreme Court and Lahore High Court have given verdicts against additionally charging the consumers on account of stolen gas. 

The sources further informed that additional collection from consumers under head UfG is against the OGRA ordinance. They said during the course of this meeting OGRA was of the view that Petroleum Ministry is demanding additionally charge the consumers on account of stolen gas. And, if gas utilities and petroleum ministry's demand is accepted then tariff of Sui Northern Gas Pipelines Limited (SNGPL) would surged to Rs11/mmbtu and tariff of Sui Southern Gas Company Limited (SSGCL) would go up by Rs7/mmbtu. Again, it is the responsibility of gas utilities to initiate measures to reduce gas theft ratio instead of charging the gas consumers additionally. 

It is noteworthy here that SNGPL had demanded of the OGRA to allow it to collect Rs6.3billion from the consumers and SSGCL demanded Rs2.1billion while Petroleum Ministry has surprisingly sought from the regulator (OGRA) Rs6.4bilion for SNGPL and Rs3.2billion for SSGCL above the demands of both gas utilities which is apparently unjust and not fair.

Moreover, OGRA on November 30 in its decision contrary to the demands of SNGPL had approved Rs2.5billion while Rs969million for SSGCL, which the gas companies and Petroleum Ministry were found not ready to accept that heavy sum of worthy amounts. Prime Minister (PM) Raja Pervez Ashraf after a thorough review of the petroleum ministry formed a committee. Besides, the Economic Coordination Committee of the Cabinet in its January 1 meeting had rejected the same summary of the Ministry of Petroleum and Natural Resources.