By Staff Reporter
ISLAMABAD: Pakistan’s two main gas utilities have petitioned regulators for prescribed price increases of as much as 28.7% to cover revenue shortfalls exceeding Rs77 billion for the fiscal year through June 2026, testing the government’s pledge to the International Monetary Fund to curb a circular debt pileup that’s already surpassed Rs3 trillion.
Sui Northern Gas Pipelines Ltd., the Lahore-based distributor, asked the Oil and Gas Regulatory Authority for a 10.7% jump, or Rs189 per million British thermal units, lifting the existing prescribed price of Rs1,766.50 to Rs1,955.50. That would leave a combined effective increase of Rs506 per mmBtu, 28.7%, pushing the total cost to Rs2,272, according to the filing.
The regulator scheduled a public hearing for Nov. 7 to review the petition.
Sui Southern Gas Co. Ltd., serving Karachi and southern Pakistan, sought a more modest 7.6% rise of Rs125.41 per mmBtu, taking its prescribed price from Rs1,658.56 to Rs1,783.96. Factoring in Rs34.3 billion of unrecouped shortfalls dating back to fiscal 2023, SSGCL’s total revenue demand would drive the prescribed price to Rs1,962.55 per mmBtu. An extra Rs57.87 per unit for the cost of serving re-gasified liquefied natural gas would bring the full tab to Rs2,021.
SNGPL cited a Rs53 billion gap in revenue requirements for the current fiscal year, plus a Rs582 million subsidy claim for liquefied petroleum gas air-mix plants. It also tacked on Rs317 per mmBtu to recover costs from diverting RLNG volumes to indigenous gas consumers, a policy greenlit by the Economic Coordination Committee and ratified by the federal cabinet on Oct. 30, 2023.
SSGCL pegged its fiscal 2026 shortfall at Rs24 billion on top of the carryover losses. The requests come despite SNGPL’s prior complaints of shrinking sales volumes after back-to-back price hikes over the past two years rendered gas unaffordable for consumers.
Under Pakistani law, Ogra determines prescribed gas prices twice yearly, in the second half of December and June, which the government then translates into consumer tariffs across categories. Islamabad has committed to the IMF to issue timely biannual notifications and avoid further circular debt accumulation.
The utilities’ moves underscore persistent strains in Pakistan’s energy sector, where subsidies, theft and inefficient billing have fueled a vicious cycle of arrears. The government, midway through a $7 billion IMF bailout agreed in September, faces pressure to align tariffs with costs without sparking public backlash.
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