ISLAMABAD: Petroleum Division has revealed that existing amount of circular debt of petroleum sector has swollen to Rs. 2.897 trillion which includes interest of Rs. 814 billion.
The major part of above circular debt is related to gas sector which includes tariff differential due to non-increase of consumer gas prices during FY 2013 to 2023, diversion of RLNG from FY 2019 to FY 2023, taxation claims, recoveries pending in courts etc.
In order to stop the flow of circular debt in gas sector mainly tariff differential and diversion of RLNG to domestic, government has revised the gas prices encompassing recovery of RLNG diversion.
New indigenous gas connections are not being provided to domestic consumers due to moratorium imposed on new domestic connections on indigenous gas by the Government. However, RLNG based connections are being offered in where network is being commissioned on RLNG.
With every passing year, the demand of natural gas is increasing across the country while the indigenous gas supplies are depleting rapidly, thus widening the demand supply gap. During last five years’ substantial decline in the indigenous gas supply has been noticed i.e. from 2378 MMCFD in FY 2018-19 to 1714 MMCFD in FY 2023-24. Despite various new gas discoveries during same period, supply stand at 1714 MMCFD in FY 2023-24 as these new fields have had nominal volumes and have not been able to offset the shortfall.
On supply side, Government is taking several measures to improve supplies which include award of new blocks for oil and gas exploration and import of LNG. On the demand side, steps including ban on expansion in domestic network on indigenous gas, tariff rationalization to conserve and optimize use of gas. Media campaigns for awareness are also being done to sensitize the customers about conservation.
