Pakistan Unveils Gas Market Deregulation Roadmap for August Approval

Pakistan is moving ahead with plans to deregulate its natural gas sector, aiming for Prime Minister Shehbaz Sharif's approval by the end of August. The reforms aim to transition the country from a state-dominated market to a more competitive one with private sector participation. The government has been struggling with declining domestic gas production, mounting circular debt, and rising demand met through costly imports of liquefied natural gas (LNG).

The roadmap for deregulation has been developed by the Petroleum Division with technical support from the World Bank. It envisions restructuring and unbundling the state-owned Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL), creating opportunities for private sector participation across the gas value chain.

The reform package includes a Gas Market Evolution Plan, an investment roadmap, a financial model, legal and regulatory reforms, and a capacity-building program for the Oil and Gas Regulatory Authority (OGRA). Petroleum Minister Ali Pervaiz Malik emphasized that deregulation should be accompanied by a regulatory framework promoting competition, improving efficiency, and protecting consumers.

The government 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 in Pakistan's gas sector.