ISLAMABAD: The Petroleum Division is grappling with reduced off-take of Regasified Liquefied Natural Gas (RLNG) by power plants, which is causing a rapid saturation of the Sui Northern Gas Company Limited (SNGPL)system. According to sources, SNGPL has been reporting lower-than-expected RLNG consumption by the power sector, which is falling short of the committed demand of 600 MMCFD for July 2025.
Salahuddin Khan, Deputy Director (Tech Gas), informed that on July 16, 2025, RLNG consumption was recorded at 327 MMCFD, far below the expected levels, with the monthly average remaining at 501 MMCFD. This discrepancy has led to a surplus gas accumulation, pushing the system pack beyond critical levels, making it increasingly difficult to manage gas flows.
The issue persisted on July 17, 2025, with power sector consumption recorded at 300 MMCFD, exacerbating the gas accumulation problem. SNGPL raised concerns that if the RLNG off-take is not increased and maintained as per demand, the resulting high pressures could disrupt re-gasification at terminals, potentially causing delays in cargo discharge and leading to demurrage charges and take-or-pay penalties.
In a statement, the Directorate General (Gas) of the Petroleum Division warned that if the situation persists, SNGPLwould be forced to reduce supplies from local gas fields, further straining the system. The Power Division has been urged to advise the relevant parties to increase the RLNG off-take in line with the projected demand for July 2025 and to make up for the previously unconsumed volumes to ensure smooth system operations.
The ongoing issue has raised significant concerns within the government. On July 10, 2025, in response to concerns raised by Ali Pervaiz Malik, the Minister for Petroleum and Natural Resources, regarding the underutilization of RLNG by Independent Power Producers (IPPs), Sardar Awais Ahmad Khan Leghari, the Minister for Power, defended the Economic Merit Order (EMO). Leghari emphasized that any attempts to alter the EMO would be a “grave sin” and explained that power plants operate under the EMO, prioritizing electricity generation from the cheapest sources. He suggested that the Petroleum Division review LNG contracts if necessary, similar to how the Power Division had reviewed IPP contracts.
Additionally, Nepra (National Electric Power Regulatory Authority) has shared violations of the EMO by the System Operator during public hearings on Fuel Cost Adjustments (FCAs). However, these hearings have now almost ceased without clear explanations. Nepra has directed the System Operator and NGC (formerly NTDC) to present comprehensive updates, covering outages of economic power plants, financial impacts, and reliance on out-of-merit generation.
At a recent meeting addressing gas sector challenges, Secretary Petroleum outlined key issues to be addressed by the committee, including the rationalization of gas tariffs (for both indigenous and imported gas), synchronization of LNG demand with the power sector, and the resolution of circular debt within the gas sector. The committee is expected to focus on sustainability in the gas sector and how RLNG over-supply and under-off-take are affecting the overall system.
