Consumers brace for gas price hike as SNGPL, SSGCL push for increases

• SNGPL seeks 42% hike in gas prices while SSGCL seeks 159% hike.
• If approved, SNGPL's gas price will climb to Rs2,485.72 per MMBTU.
• SSGC cites revenue requirement of Rs883.544bn for FY2025-26.
  

ISLAMABAD: Gas consumers in Pakistan must brace themselves for a substantial surge in their gas bills starting from July 2025, following proposals for significant price increases for FY2025-26 by Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company (SSGC).

SNGPL has submitted a petition seeking a 42% hike in gas prices, equivalent to Rs735.59 per million British Thermal Unit (MMBTU). If approved by the Oil and Gas Regulatory Authority (Ogra), this would set SNGPL's gas price at Rs2,485.72 per MMBTU.

Meanwhile, the proposal from SSGC is even more drastic, requesting a 159% increase, amounting to Rs2,443 per MMBTU. This massive hike reportedly includes measures to recover past financial shortfalls faced by the company.

SNGPL cited a substantial revenue shortfall of Rs207.4 billion and escalating costs associated with both locally produced gas and Re-Gasified Liquefied Natural Gas (RLNG) as the primary reasons for the proposed increase.

SNGPL also highlighted a projected increase of Rs231.604 billion in the cost of indigenous gas and an estimated Rs299.936 billion for RLNG diversion costs.

The petitioner also said that the prior year shortfall up to FY2024-25 is Rs478.54 billion, which becomes Rs685.976 billion after including current year shortfalls. Besides, the petitioner has claimed the RLNG service cost of Rs69.889 billion (i.e. Rs317.72/MMBTU) for FY2025-26.

Public hearings on SNGPL's petition are scheduled for April 18 in Lahore and April 28 in Peshawar.

Furthermore, SSGC has filed a petition seeking the tariff to be increased to Rs4,137.49 per MMBTU, driven by a total revenue shortfall of Rs498.76 billion from previous years. 

The company attributes the hike to the increasing cost of RLNG and the dwindling supply of indigenous gas. The company has cited a revenue requirement of Rs883.544 billion for the upcoming fiscal year.

Meanwhile, the National Electric Power Regulatory Authority (Nepra) has approved the federal government's plan to redirect Rs58 billion collected from oil consumers to relieve electricity users, cutting power rates by Rs1.71 per unit for Discos and K-Electric consumers.

The relief, effective from April to June 2025, aims to ease the financial burden on electricity consumers across the country, excluding lifeline consumers. 

This move comes as part of a larger Rs325 billion subsidy package for FY2024-25, which includes the newly approved Rs58.6 billion allocation for this relief.