In a major development for Pakistan’s energy sector, Sui Northern Gas Pipelines Limited (SNGPL) has approved a 50 million cubic feet per day (mmcfd) pipeline capacity allocation to Universal Gas Distribution Company (UGDC), the country’s first private gas marketing firm. The decision also allows the transfer of several high-end consumers from SNGPL to UGDC for direct gas supply — a move that marks a significant shift toward private participation in the gas market.
According to an official communication from SNGPL, the utility has accepted UGDC’s request for an additional 35 mmcfd capacity — 25 mmcfd on a firm basis until 2033 and 10 mmcfd on an interruptible basis for six months. With this approval, UGDC’s total pipeline capacity has now increased from 15 mmcfd to 50 mmcfd. SNGPL further directed the private firm to enhance its security deposit accordingly and ensure that all consumers shifting from SNGPL to UGDC clear outstanding dues before transportation services commence.
UGDC’s Chief Executive Officer, Ghiyas Paracha, stated that the company will deposit Rs800 million as an advance and pay nearly Rs1 billion per month in transportation and gas loss charges. Despite buying some of the most expensive gas in the country — even above LNG prices — Paracha said UGDC would still provide it to consumers at lower rates by keeping profit margins minimal.
Industry insiders noted that UGDC will pay around a 20 percent premium over the official gas rate set under the Petroleum Policy 2012.
The approval follows months of internal deliberations and reversals. On September 11, SNGPL’s Board of Directors (BoD) temporarily deferred the pipeline capacity allocation, despite having approved it earlier on August 15. The BoD later decided, after reviewing the Ministry of Energy’s guidance, to restore the earlier decision, allowing the additional capacity to UGDC through a second addendum to the existing access agreement.
Meanwhile, the Petroleum Division is reviewing a proposal to impose a captive gas levy on private gas distribution — a move seen as an attempt to ensure fair competition between public and private sector suppliers, with UGDC currently being the only private player in the market.
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if SNGPL failed to supply gas in transparent manners why those responsible for mismangment are not identified and punished?
If we add more and more people in supply chain we add more and more parasites on public revenue and that makes gas or any other thing more and more expensive.
Things can’t change unless accountability starts and is evident for public as witness
Alhamdolilah
Assalamualaikum hamre multan zelah tehsel jhaniya Chak jadeed me gass ki saholat mojood nhi hy or hamre nazdeek 15 mint ky waqfe per gass mojood per hamy nhi de rahy intazamiya se durkhwast hy k hamari derkhwast manzoor kary
It will be much expensive and anything govt will impose definitely transferred to consumers. Tariff is not objectionable and not challengeable in any Court which is against basic human rights, really disrespectful and unfair.