ISLAMABAD: The Cabinet Committee on Energy (CCoE), chaired by Prime Minister Shehbaz Sharif, was scheduled to discuss a major policy shift today. The proposed change would allow Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGCL) to offer domestic gas connections using Re-gasified Liquefied Natural Gas (RLNG).
However, the meeting was postponed due to the Prime Minister’s emergency visit to flood-affected areas in Punjab, Federal Minister for Petroleum and Natural Resources, Ali Parvaiz Malik, confirmed. According to a summary prepared by the Petroleum Division, the policy would permit SNGPL and SSGCL to clear a backlog of domestic gas applications using RLNG. Tariffs would be based on rates set by the Oil and Gas Regulatory Authority (OGRA). The move is expected to benefit many households, especially in new housing schemes and underdeveloped colonies, currently dependent on liquefied petroleum gas (LPG) cylinders. Officials said RLNG would be supplied to new residential and commercial applicants. It is currently 31.25pc cheaper than LPG. However, new RLNG users will not receive the same tariff slabs as existing domestic gas consumers, who fall under 12 categories. Pakistan is facing an RLNG surplus. Authorities aim to utilise this excess by extending imported gas to new customers across the country, a senior official told this scribe. “For domestic applicants living in 10-marla houses, the connection fee will be Rs 21,000. For those in houses larger than 10 marlas, the fee will be Rs 23,000,” the official explained. “Once the connection process is complete, applicants must also pay a security deposit of Rs 20,000 at the time of contract signing. Those who paid earlier will need to pay the difference.” In the first year, around 300,000 applicants are expected to receive RLNG connections. This number is projected to double to 600,000 in the second year.
According to the Petroleum Division’s summary for the CCoE, there are 3.2 million pending gas connection applications. Of these, 240,000 applicants have already paid, and 4,000 paid Rs 25,000 each for urgent processing. One major obstacle to large-scale RLNG deployment has been the tariff gap between cheaper local gas and costlier imported RLNG. Sui companies have been hesitant to offer RLNG to applicants waiting for local gas due to fears of legal challenges and accusations of discrimination. To prevent litigation, officials propose using transparent contracts with consumer consent. These would clearly define RLNG pricing terms.
Government officials argue that RLNG is 32pc cheaper than LPG cylinders. It also offers greater safety and ease of use. Cylinders pose risks of explosion and are difficult to handle. Substandard LPG equipment remains a major cause of domestic accidents—risks that RLNG connections could help prevent. In contrast, piped RLNG offers a stable, on-demand energy source with fewer hazards. Gas consumption in Pakistan has declined sharply. Sluggish economic growth, reduced power demand, and steep cuts in RLNG use by the export sector have contributed to the fall. Exporters cut their RLNG offtake from 350 mmcfd to just 100 mmcfd after the government raised RLNG prices to $16.35/MMBTU—well above global rates. The price hikes were part of the conditionalities tied to the ongoing $7 billion IMF loan programme. These included a Rs 3,500 per MMBTU gas price increase for export industries and a series of levies—5pc from July 1, 2025, rising to 20pc by August 1, 2026.
Line-pack pressure in the gas transmission system has now exceeded 5 BCF—a critical safety threshold. This raises the risk of pipeline ruptures and system failure. To reduce pressure, authorities cut 370 mmcfd of local gas production as of August 28, 2025. To absorb excess RLNG, SNGPL diverted it to domestic users, despite its high cost. According to OGRA’s 2025 Estimated Revenue Requirements, 24 RLNG cargoes were redirected to households. This added Rs 242 billion in extra costs, directly contributing to the gas tariff hike on July 1, 2025.