ISLAMABAD: The Oil and Gas Regulatory Authority (OGRA) has approved changes in gas prices for both Sui Northern and Sui Southern gas companies. However, the final decision will be made by the federal government, after which OGRA will issue a formal notification.
According to OGRA’s recommendations, the gas price for Sui Northern Gas Pipelines Limited (SNGPL) has been increased by Rs116.90 per MMBTU. On the other hand, the price for Sui Southern Gas Company (SSGC) has been reduced by Rs103.95 per MMBTU.
OGRA stated that the price hike for SNGPL is due to the increased import of RLNG (Re-gasified Liquefied Natural Gas). OGRA has also advised the government to review SNGPL’s case and consider setting gas prices based on different consumer categories to ensure fair distribution of the burden.
The changes in prices are based on the expected financial shortfall of the gas companies for the fiscal year 2025–26. The summary has been sent to the federal government for final approval.
Once the government gives its approval, OGRA will officially announce the new gas prices.
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Meanwhile, earlier media reports revealed that the government has prepared a plan to raise electricity, gas, and petrol prices at the start of the new financial year beginning July 1, 2025. Sources say these steps are part of commitments made to the International Monetary Fund (IMF) ahead of the upcoming budget.
According to the reports, electricity tariffs will undergo annual rebasing from July, and gas prices will be adjusted on July 1 and again on February 15, 2026. Additionally, a Rs5 per litre carbon levy is expected to be imposed on petrol and diesel. Provinces will not offer any subsidies on electricity or gas.
The government has also agreed with the IMF on major budget targets for 2025–26. To manage circular debt, Rs1,252 billion will be borrowed from banks, which will later be recovered from consumers through a 10% surcharge on electricity bills. The government will have the authority to increase this charge if needed.
The budget is also expected to reduce subsidies on electricity, with the aim of bringing circular debt to zero by 2031. NEPRA will continue quarterly tariff adjustments, and fuel cost changes will be applied on time. Only targeted subsidies will be given, and a circular debt management plan is expected to be approved by the cabinet in July.
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By January 2025, electricity circular debt had reached Rs2,444 billion, and gas circular debt stood at Rs2,294 billion by June 2024. Reforms to reduce these debts will continue, and negotiations with IPPs are expected to lead to Rs348 billion in payments by June.
Officials say cost recovery will be improved to help reduce energy prices in the long run.
