The Ministry of Petroleum and the Oil and Gas Regulatory Authority (OGRA) officials have categorically told the Senate Standing Committee that the increase in gas prices has become inevitable from January next year.
A meeting of the Senate Standing Committee on Petroleum was held under the chairmanship of Senator Abdul Qadir, in which the officials of the Ministry of Petroleum said that if the prices are not increased, the circulating debt will increase by Rs 275 billion.
The ministry representatives highlighted the pressing need for this hike.
The current pricing system, according to officials, is failing to cover the costs of these contracts, leading to a ballooning "circular debt" for gas companies. This debt, currently exceeding Rs 2,100 billion, threatens the stability of the entire gas sector.
DG Gas revealed the projections by Sui companies suggested an anticipated revenue of Rs 700 billion for the fiscal year, expected to soar to 950 billion rupees post the proposed price hike.
During the deliberation, Sui Southern officials cautioned that Balochistan might face a drastic surge of over 300% in gas bills during winter due to escalated consumption. To mitigate this, the Committee proposed implementing fixed gas rates for three months specifically for the colder regions.
However, Committee member Mohsin Aziz voiced dissent, adamantly opposing the imposition of LNG usage burdens on smaller provinces. As the session concluded, the Committee demanded clarity from the Ministry of Petroleum in the subsequent meeting, seeking an in-depth explanation regarding the impending price adjustment.
