Govt Raises RLNG Prices by 15% After Emergency Spot Purchases

The Oil and Gas Regulatory Authority (OGRA) has increased the price of Regasified Liquefied Natural Gas (RLNG) by around 15% for June, reflecting the higher cost of emergency spot LNG imports made after supply disruptions during the US-Iran conflict.

The revised prices mark a sharp increase over recent months, with RLNG now costing nearly 56% more than in March and around 73% more than in February, significantly raising fuel costs for power generation and industrial consumers.

According to OGRA’s latest notification, the transmission-stage RLNG price for Sui Northern Gas Pipelines Limited (SNGPL) has increased by 14.85% to $17.94 per mmBtu, while the distribution-stage price has risen by 14.94% to $19.52 per mmBtu.

For Sui Southern Gas Company Limited (SSGCL), the transmission-stage price has increased by 16% to $16.37 per mmBtu, while the distribution-stage price has climbed 16.17% to $18.64 per mmBtu.

The increase comes after Pakistan was forced to procure LNG cargoes from the international spot market at significantly higher prices following supply disruptions linked to the temporary closure of the Strait of Hormuz and interruptions to Qatar’s gas operations during the regional conflict.

Three of the four LNG cargoes imported in June under Pakistan State Oil’s long-term contract with QatarEnergy were priced at an average of $13.14 per mmBtu, up sharply from around $9.20 per mmBtu in May. Meanwhile, Pakistan LNG Limited (PLL), which was reactivated after remaining largely dormant for more than two years, imported one emergency spot cargo at $19.13 per mmBtu.

The higher import costs have flowed through to domestic RLNG prices. In addition to expensive spot purchases, end-user prices have been pushed higher by distribution losses, port charges, retainage, and margins charged across the LNG supply chain.

The impact is already visible in electricity generation costs. RLNG-based power generation fuel costs increased to Rs31 per unit in May, more than doubling from Rs13.72 per unit in April, adding pressure to Pakistan’s power sector and potentially future electricity tariffs.

According to OGRA, around two-thirds of PLL’s June cargo will be supplied to K-Electric, while the remaining volume will be allocated to SNGPL for distribution to consumers.