Pakistan’s gas circular debt hits Rs3.283 trillion as theft losses reach Rs30 billion annually

Pakistan’s gas sector circular debt has surged to Rs 3.283 trillion, while annual losses from gas theft and system inefficiencies are estimated at around Rs 30 billion, officials informed parliamentary panels. 

As per reports, Director General Gas Abdul Rasheed Jokhio told the National Assembly Standing Committees on Energy and Petroleum that circular debt across the gas supply chain has reached Rs 3.283 trillion, reflecting sustained financial pressure in the sector. Lawmakers cautioned that continued accumulation of liabilities could destabilise state-run utilities and increase costs for consumers.

Managing Director Sui Northern Gas Pipelines Limited Amir Tufail stated that unaccounted-for gas losses stood at 5.27% in FY25, compared with 4.93% in FY24, remaining below the threshold set by the Oil and Gas Regulatory Authority. He said SNGPL incurs annual financial losses of around Rs 30 billion, with unaccounted-for gas totaling approximately 30 billion cubic feet per year.

Officials from Sui Southern Gas Company informed the committee that losses have declined from 17% to 10%, equivalent to nearly 29–30 billion cubic feet annually. Balochistan was identified as a major contributor to leakages. They added that gas theft and inefficiencies at SSGC also result in yearly losses of about Rs 30 billion.

Lawmakers said combined annual losses of the two gas utilities, estimated at around Rs 60 billion, are ultimately passed on to consumers. Members alleged that industrial users were involved in theft while the financial impact was being recovered from domestic customers. 

Officials noted that losses within the regulatory threshold determined by OGRA are also transferred to consumers and that even developed systems can record up to 6% unaccounted-for gas losses.

Some members called for privatisation of the utilities, arguing that gas distribution is not a core government function. Others warned that unchecked circular debt could damage the companies if structural reforms are delayed. The committee chairman emphasised that any privatisation process must avoid monopolistic structures and protect consumers.

In a separate briefing, the Petroleum Division sought Rs 4.72 billion in development funding for the next fiscal year for projects including an explosives tracking system, geological surveys and initiatives of the Hydrocarbon Development Institute of Pakistan. Officials from the Geological Survey of Pakistan also informed lawmakers that lithium reserves have been identified in Gilgit-Baltistan and Kotli.

Meanwhile, a subcommittee was informed that Hyderabad Electric Supply Company would submit its business plan to the National Electric Power Regulatory Authority before April. Members also sought a report on the relocation of a 132kV grid station and raised concerns about the utilisation of energy training funds collected by petroleum companies.