Govt mulls replacing gas subsidy slabs with single price

By The government is considering replacing the existing slab-based gas subsidy system with a single gas price for all consumers, with targeted social protection measures, Federal Minister for Petroleum Ali Pervaiz Malik said. The minister gave these remarks while chairing a meeting with the Chairman and Board of Directors, Managing Director and senior management of Sui Southern Gas Company Limited (SSGCL) Karachi to review the company's performance, key achievements, operational challenges and future reform priorities. The minister said that the existing system of gas subsidies via pricing slabs needs to be revisited. He emphasised the need to transition to a single fair gas price for all consumers, while vulnerable segments are to be protected through targeted social protection programmes. This transition would spur greater economic activity while quelling migration of customers to alternative fuels. During the meeting, Malik directed the Board of SSGCL to develop a comprehensive strategy and sustainable business model with special focus on UFG control to transform SSGCL into a financially viable organisation, with public service as the foremost priority. SSGCL's Managing Director briefed the minister on the company's milestones, achievements and challenges. The management highlighted a significant improvement in the company's gas distribution system, with UFG reduced by approximately 57% in volumetric terms. The meeting was informed that there is no gas load shedding for K-Electric, industrial consumers and fertiliser plants, while domestic consumers are being provided gas three times a day. Ali Pervaiz Malik highlighted that gas prices have not been increased for the past year, while the increase in gas circular debt has nearly been stopped, marking important progress towards stabilisation of the gas sector. The minister said the government is already working with the World Bank on comprehensive gas sector reforms, aimed at addressing structural challenges and creating a more efficient, sustainable and financially viable gas sector. Discussing the situation in Balochistan, the SSGCL Board welcomed the constitution of the political committee under the Deputy Prime Minister to look into the province's challenges and appreciated the initiative as a positive step towards addressing longstanding issues in Balochistan. The minister directed that gas supply issues in Balochistan be resolved on a priority basis, alongside addressing technical challenges, infrastructure constraints and gas theft. He stressed the need for sustainable solutions to improve gas availability and service delivery in the province. The federal minister added that public service must remain the top priority in all operational, financial and strategic decisions, while pursuing reforms to ensure the long-term sustainability of the company.