Petroleum Minister Calls for Major Gas Pricing Reform

Federal Minister for Petroleum Ali Pervaiz Malik has called for a review of Pakistan’s existing slab-based gas pricing system, arguing that the country should gradually move towards a single and equitable gas tariff while shielding low-income and vulnerable consumers through targeted social protection measures.

The minister said such a change could encourage economic activity and reduce the incentive for consumers to shift away from natural gas towards alternative energy sources.

Ali Pervaiz Malik made the remarks while chairing a meeting in Karachi with the Chairman and Board of Directors, Managing Director and senior management of Sui Southern Gas Company Limited (SSGCL). The meeting examined the company’s overall performance, recent progress, operational difficulties and areas requiring future reforms.

The minister instructed SSGCL’s Board to prepare a detailed strategy and develop a sustainable business model aimed particularly at reducing Unaccounted-for-Gas (UFG). The objective, he said, should be to turn the company into a financially sustainable organisation while ensuring that serving the public remains its primary responsibility.

During the meeting, SSGCL management briefed the minister on the company’s performance, achievements and ongoing challenges. Officials reported substantial progress in the gas distribution network, with UFG declining by around 57% in volumetric terms.

The meeting was also informed that K-Electric, industrial consumers and fertiliser plants were not experiencing gas load shedding. Domestic consumers, meanwhile, were receiving gas supplies three times daily.

Malik pointed out that gas prices had remained unchanged for approximately one year and said the growth of circular debt in the gas sector had almost been brought to a halt, describing both developments as signs of progress towards greater sector stability.

He directed the SSGCL Board to prepare a broader reform plan aimed at making the company self-sufficient, enhancing operational performance and human resource capabilities, reducing financial losses and gas theft, improving revenue collection and making more effective use of available resources.

The Secretary Petroleum stressed that the SSGCL Board should function independently in line with the principles established under the State-Owned Enterprises (SOE) Act. He urged the directors to fully exercise their authority and take appropriate steps to improve efficiency and secure the company’s long-term financial sustainability.

The petroleum minister also said the government was collaborating with the World Bank on wide-ranging reforms for the gas sector. The initiative is intended to address deep-rooted structural problems and establish a more efficient, sustainable and financially stable gas industry.

The discussion also covered gas-related challenges in Balochistan. SSGCL’s Board welcomed the formation of a Political Committee under the Deputy Prime Minister to examine the province’s longstanding issues, describing the move as a constructive step towards resolving them.

Malik instructed officials to treat gas supply problems in Balochistan as a priority. He called for simultaneous action on technical difficulties, infrastructure limitations and gas theft, stressing that durable solutions were needed to improve both gas availability and service quality.

The minister reiterated that public service must remain at the centre of SSGCL’s operational, financial and strategic decisions. At the same time, he emphasised that necessary reforms must continue to ensure the company remains sustainable over the long term.