The government has approved a 9% increase in gas rates for industrial captive power units, effective from July 1, to comply with the IMF’s prior action. However, relief in gas rates for other consumers has been blocked, totaling Rs133 billion. This decision was made during a special meeting of the Economic Coordination Committee (ECC) chaired by Finance Minister Muhammad Aurangzeb.
The Oil and Gas Regulatory Authority (Ogra) had recommended a reduction in gas prices for the fiscal year 2024-25. Despite this, Ogra later asked the government to absorb a price cut to finance circular debt instead of providing relief to consumers.
The ECC approved a 9.1% increase in gas sale rate to captive plants of the general industry. The consumer-end gas tariff for other users will remain unchanged until December 31, 2024.
The petroleum division highlighted the revenue requirements for Sui Northern Gas Pipelines Ltd and Sui Southern Gas Company Ltd. The surplus revenue is estimated to be Rs133 billion, which will be recouped through a revision in gas rates in January 2025.
This decision comes after previous increases in gas tariffs earlier this year. The government aims to balance revenue requirements while ensuring compliance with IMF conditions.\
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