ISLAMABAD: The federal government has missed the July 1, 2026 deadline for notifying the biannual gas tariff, falling short of a key structural benchmark agreed with the International Monetary Fund (IMF) under Pakistan’s $7 billion Extended Fund Facility (EFF).
Under the IMF programme, Pakistan committed to implementing semi-annual gas tariff adjustments on July 1, 2026, and February 15, 2027, to ensure consumer gas prices remain at cost-recovery levels and help curb the growing circular debt in the energy sector.
Government officials said the notification was delayed due to legal and procedural issues surrounding the appointment of Nabeel Ahmad Awan as Acting Chairman of the Oil and Gas Regulatory Authority (OGRA). His appointment faced legal challenges, while volatility in global energy prices also delayed the regulator’s assessment of gas companies’ revenue requirements.
Officials said OGRA has now completed the required public hearings and finalized the revenue determinations, including revised targets for reducing Unaccounted-for-Gas (UFG) losses. However, the acting chairman insisted on adopting station-specific UFG reduction plans, supported by documented implementation strategies for each Custody Transfer Station (CTS) in the Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGC) networks, instead of relying on broad annual targets.
According to officials, the gas tariff determination is ready and could be issued at any time. Gas utilities have requested an additional month to submit detailed implementation plans for achieving the revised UFG reduction targets.
Officials described the delay as a technical breach of the IMF benchmark, noting that any impact would be addressed through subsequent revenue adjustments. They added that once OGRA issues its determination, the government intends to notify revised consumer gas tariffs without waiting for the full 40-day period allowed under the OGRA law.
Pakistan’s gas sector continues to face mounting financial pressure, with circular debt reaching Rs3.442 trillion by the end of December 2025. As part of its IMF commitments, the government is implementing measures to improve gas system monitoring, reduce UFG losses, strengthen coordination across the energy sector, and introduce a new Gas Circular Debt Management Plan during the current fiscal year.
Story by Khaleeq Kiani
