Oil & Gas Distribution: What does 6.3% UFG allowance by OGRA mean for Gas Distribution Companies? – By Insight Research

<ul><li><span style="font-family:Arial, Helvetica, sans-serif;font-size:medium;">As per the usual practice, OGRA has notified the Estimated Revenue Requirement (ERR) for SNGP and SSGC for FY2018.</span></li><li><span style="font-family:Arial, Helvetica, sans-serif;font-size:medium;">However, this time OGRA has also quoted additional provisional UFG allowance over the benchmark in the ERR (which was usually determined in Final Revenue Requirement (FRR) towards the end of the fiscal year).</span></li><li><span style="font-family:Arial, Helvetica, sans-serif;font-size:medium;">This will lead to lower volatility in results. Previously, Sui companies used to make quarterly accounts on benchmark UFG (4.5%), showing higher UFG disallowance, while the adjustment of final UFG allowance including the additional component (4.5%+2.6%=7.1% in F...