Key Takeaways
- The government plans to deregulate Pakistan’s gas sector.
- Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL) will be unbundled into separate transmission, distribution, and energy businesses.
- Reforms aim to establish a competitive market with fairer pricing for industrial consumers.
The government of Pakistan has announced plans to deregulate the country’s gas sector, restructuring and unbundle Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL), according to a press release from the ministry.
These reforms are part of a broader roadmap being prepared with technical support from the World Bank. The plan was reviewed by Federal Minister for Petroleum Ali Pervaiz Malik and World Bank Country Director Bolormaa Amgaabazar on Tuesday.
The proposed restructuring will separate the transmission, distribution, and energy businesses within SNGPL and SSGCL, aiming to create a more competitive gas market in Pakistan.
According to the reform plan, the Oil and Gas Regulatory Authority (OGRA) will be given a stronger role in market regulation, competition oversight, and monitoring. This is expected to support the financial sustainability of the Sui companies while opening opportunities for private investment across the gas value chain.
The reforms also call for redesigning the existing gas subsidy structure, redefining the protected customer category, and reducing market distortions as the government moves towards a single market-clearing price. This is intended to reduce cross-subsidy burdens and introduce fairer pricing, particularly for industrial consumers.
Representatives from SNGPL, SSGCL, and OGRA attended the meeting where the roadmap was reviewed. The Petroleum Division expects to finalize the reform framework by the end of August for submission to Prime Minister Shehbaz Sharif.
Subject to approval, the reforms will be implemented in phases, with consultations with relevant stakeholders. The government aims to create a more competitive and transparent gas market that supports private sector participation and financial sustainability of Sui companies.
