The Petroleum Division will submit a finalized roadmap for deregulating the natural gas sector to Prime Minister Shehbaz Sharif by the end of August 2026, as the government moves forward with plans to overhaul the state-dominated gas market.
The roadmap, developed by the Petroleum Division with technical support from the World Bank (WB), was discussed on Tuesday during a meeting between Federal Minister for Petroleum Ali Pervaiz Malik and Bolormaa Amgaabazar, Country Director of the World Bank in Pakistan.
The minister directed that the finalized document be prepared for approval by the prime minister by the end of August. Once approved, the Petroleum Division will begin implementing the reforms in phases, in consultation with stakeholders.
The reforms are aimed at addressing years of declining domestic gas production, rising circular debt and growing demand met increasingly through costly imports of liquefied natural gas.
They form part of broader energy sector reforms backed by international financial institutions, including the World Bank and the International Monetary Fund (IMF), intended to improve efficiency, attract private investment and reduce the fiscal burden of energy subsidies.
Under the proposed plan, the two state-owned gas utilities, SNGPL and SSGCL will be restructured and unbundled, with their transmission, distribution and energy businesses separated to allow greater private sector participation across the gas value chain.
The plan also calls for a more competitive gas market supported by stronger regulation and monitoring, with an expanded role for the Oil and Gas Regulatory Authority (OGRA) in ensuring fair competition and oversight.
The reform package includes a Gas Market Evolution Plan, an investment roadmap, a financial model for the sector, legal and regulatory reforms, and a capacity-building program for OGRA.
Speaking at the meeting, Minister Malik said deregulation must be accompanied by a regulatory framework that promotes competition, improves efficiency and protects consumers.
He added that the existing gas subsidy regime should be redesigned to provide more targeted support, redefine protected consumer categories and move gradually toward a single market-clearing price.
The government expects the reforms to strengthen energy security, reduce cross-subsidies, improve pricing transparency for industrial consumers, place the Sui companies on a more sustainable financial footing, and encourage greater investment across the gas sector.
