- World Bank-backed reform plan proposes restructuring Sui companies, expanding private sector role
- Government says roadmap aims to create competitive gas market with stronger regulatory oversight
ISLAMABAD: Pakistan will submit a roadmap to deregulate its natural gas sector to Prime Minister Shehbaz Sharif by the end of August, the Petroleum Division said on Tuesday, as the government moves ahead with plans to overhaul the country’s state-dominated gas market.
Pakistan has struggled for years with declining domestic gas production, mounting circular debt and rising demand that has increasingly been met through costly imports of liquefied natural gas (LNG). The government has been pursuing broader energy sector reforms, supported by international financial institutions including the World Bank and the International Monetary Fund, to improve efficiency, attract private investment and reduce the fiscal burden of energy subsidies.
The proposed reforms envision a transition to a more competitive gas market with greater private sector participation, stronger regulatory oversight and the restructuring of Pakistan’s two state-owned gas utilities, Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL). The roadmap has been developed by the Petroleum Division with technical support from the World Bank.
“The Minister directed that the finalized roadmap be prepared for the Prime Minister by the end of August 2026 for approval,” the Petroleum Division said in a statement after Federal Minister for Petroleum Ali Pervaiz Malik met with Bolormaa Amgaabazar, Country Director of the World Bank in Pakistan, and her team to review the roadmap for Pakistan’s gas sector transformation.
The statement said that, following the prime minister’s approval, the Petroleum Division would begin implementing the reforms in phases in consultation with stakeholders.
The ministry said the roadmap proposes restructuring and unbundling the Sui companies by separating their transmission, distribution and energy businesses while creating greater opportunities for private sector participation across the gas value chain.
It also envisions a competitive gas market supported by stronger regulation and market monitoring, with the Oil and Gas Regulatory Authority (OGRA) playing an expanded role in ensuring fair competition and oversight.
The statement said the reform package includes a Gas Market Evolution Plan, an investment roadmap, a financial model for the sector, legal and regulatory reforms and a capacity-building program for OGRA.
During the meeting, Petroleum Minister Malik said deregulation should be accompanied by a regulatory framework that promotes competition, improves efficiency and protects consumers. He also said the current gas subsidy regime should be redesigned to provide more targeted support, redefine protected consumer categories and ultimately move toward a single market-clearing price.
The government said it expects the reforms to strengthen energy security, reduce cross-subsidies, improve pricing transparency for industrial consumers, place the Sui companies on a more sustainable financial footing and encourage investment across Pakistan’s gas sector.
