ISLAMABAD: A delayed ruling by the Oil and Gas Regulatory Authority (OGRA) on Sui Southern Gas Company’s (SSGC) revenue requirement for FY 2022-23 has ignited major controversy, coinciding with a staggering 600% jump in SSGC’s share price — raising allegations of regulatory favoritism.
OGRA approved the Final Revenue Requirement (FRR) for SSGC on October 1, 2024 — nearly a year late. The delay has drawn scrutiny, especially as SSGC’s share price surged from Rs8 on October 21, 2024, to Rs42 by January 1, 2025, without any significant corporate developments. The Pakistan Stock Exchange (PSX) flagged the unusual trading activity and sought clarification from SSGC, which the company denied, asserting no material changes.
Meanwhile, Sui Northern Gas Pipelines Limited (SNGPL) filed a writ petition against OGRA’s FRR decision for FY 2022-23, alleging bias in the regulator’s methodology for calculating returns on assets and human resource costs. A major point of contention was OGRA’s approval of Rs19,659 million for SSGC’s HR costs — Rs91 million higher than SSGC’s own request — while rejecting SNGPL’s HR claims outright.
Further fueling suspicions, although OGRA had quickly published SNGPL’s FRR, it withheld SSGC’s decision until after media scrutiny in April 2025. Critics have accused OGRA of concealing the decision to avoid public backlash.
The controversy also surrounds OGRA’s CPI allowance, granting SSGC a 50% indexation while SNGPL received only 25%, despite SNGPL being a larger and profit-making entity. Additionally, OGRA’s inclusion of fixed charges in SSGC’s profit calculations raised concerns about undermining national efforts to reduce circular debt in the energy sector.
In December 2024, SSGC reported a Rs1,474 million gain in its HR benchmark, while SNGPL posted a Rs6 billion loss under similar headings — further deepening accusations of favoritism.
OGRA, however, dismissed the allegations as “baseless,” emphasizing that the matter is subjudice before the Lahore High Court (LHC). The regulator also claimed that figures related to SSGC’s stock performance had been exaggerated and accused SNGPL of attempting to sway future regulatory decisions.
The situation has revived memories of the 2013 scandal involving ex-OGRA chairman Tauqeer Sadiq, under whose tenure regulatory manipulation caused an estimated Rs82 billion loss to the national exchequer.
As legal battles unfold, the controversy underscores deepening tensions in Pakistan’s regulatory and energy sectors.
Story by Wasim Iqbal
