Gas prices set to skyrocket as Sui Southern seeks massive increase

In Islamabad, Pakistan, two gas utilities, Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGC), have petitioned the Oil and Gas Regulatory Authority (Ogra) for significant increases in their gas prices for the fiscal year 2025-26. SNGPL is requesting an approximate 42% increase, while SSGC demands a substantial 144% rise in prescribed prices to address their revenue shortfalls. Public hearings to discuss these requests have been scheduled for April 18 and April 21, 2025, respectively. SSGC, based in Karachi, projects a shortfall of Rs44 billion against its revenue requirement of Rs385 billion for the coming fiscal year. Additionally, it has cited an unrecovered shortfall of Rs499 billion from previous years, escalating its total shortfall to Rs543 billion. The company's request for a price increase aims to cover these financial gaps and enhance its revenue generation capabilities. Similarly, SNGPL has also outlined a revenue shortfall situation, totaling Rs686 billion, combining its current shortfall and previously unrecovered amounts. The company has emphasized its need for a price hike from Rs1,770 per million British thermal units (mmBtu) to Rs2,486 per mmBtu, a 41.58% increase. This request is bolstered by claims of increased costs related to re-gasified liquefied natural gas (RLNG) and a reduction in sales volumes due to prior price hikes. Both companies have justified their price increase petitions by citing the impact of international market prices on the cost of gas, combined with commitments made to the International Monetary Fund (IMF) for timely notifications of rate adjustments to prevent the accumulation of circular debt. This scenario highlights the ongoing struggle between gas utilities and regulatory frameworks in Pakistan, indicating potential challenges ahead for consumers regarding affordable natural gas access.