Gas consumers across Pakistan may face a major financial burden starting July, as both Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL) have filed requests for steep increases in gas tariffs for the next fiscal year.
According to available documents, both SNGPL and SSGCL have filed petitions with the Oil and Gas Regulatory Authority (OGRA) for the determination of new gas prices for the fiscal year 2025–26.
SNGPL has requested OGRA’s approval to increase the average prescribed price of natural gas to Rs. 2,485.72 per Million British Thermal Units (MMBTU) for FY 2025–26. The proposed price hike is primarily driven by a revenue shortfall of Rs. 207,435 million and a significant rise in the cost of gas, including both indigenous gas and Regasified Liquefied Natural Gas (RLNG). The petition highlights an increase in the cost of indigenous gas, projected at Rs. 231,604 million, and the cost of RLNG diversion, estimated at Rs. 299,936 million. Operating costs have also surged, with SNGPL citing Rs. 37,007 million for HR and other expenses. Financing costs related to late payments further contribute to the request, with a surcharge totaling Rs. 97,150 million. Moreover, SNGPL has proposed substantial capital expenditures to expand the gas network, including the laying of pipelines and measures to control unaccounted-for gas (UFG).
Public hearings for the SNGPL petition will be held on April 18, 2025, at the company’s Head Office in Lahore, and on April 28, 2025, at the Serena Hotel in Peshawar. These hearings will provide stakeholders an opportunity to voice their concerns regarding the proposed hike.
Meanwhile, SSGCL has filed its own petition, requesting a price increase to Rs. 4,137.49 per MMBTU, which includes recovery of the unrecouped shortfall from previous years, totaling Rs. 498,764 million. This increase is also attributed to the rising cost of RLNG and the declining availability of indigenous gas. The company has cited a revenue requirement of Rs. 883,544 million for the upcoming fiscal year. SSGCL’s petition also emphasizes the need for significant investment to maintain and expand the gas distribution network, with proposed capital expenditures focused on laying new pipelines, expanding distribution systems, and enhancing infrastructure across Sindh and Balochistan, where gas supplies are increasingly constrained.
A public hearing for SSGCL’s petition is scheduled for April 21, 2025, at the company’s Head Office in Karachi, followed by another on April 23, 2025, at the Serena Hotel in Quetta.
It is pertinent to mention that the increase in gas prices is expected to put additional pressure on domestic consumers, with gas bills likely to rise significantly in the coming months. Small businesses that rely on gas for operations are also expected to face financial strain, with some possibly forced to scale back or shut down. Additionally, the industrial sector—particularly energy-intensive industries—may see rising production costs, potentially leading to slower growth and job cuts.
As Pakistan’s gas sector grapples with these financial challenges, both SNGPL and SSGCL are seeking to recover costs and ensure the sustainability of gas supply and infrastructure. However, the proposed hikes are likely to have a significant impact on consumers already burdened by high energy costs. Whether these increases are essential to maintain gas infrastructure or if alternative solutions exist to reduce the financial strain on the public remains a key question.
The upcoming public hearings will play a critical role in determining the final decision on the proposed tariff hikes, and consumer participation will be vital to ensure their concerns are heard and addressed in the regulatory process.
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