Exploration and Production (E&P) companies in Pakistan have suffered losses exceeding Rs. 50 billion from 2021 to 2024, attributed to reduced gas outflows by Sui companies into the national transmission grid. Major companies such as Oil and Gas Development Company (OGDC), Mari Petroleum, Pakistan Petroleum Limited (PPL), and MOL have repeatedly cautioned that limiting local gas flows threatens the viability of aging wells, necessitating costly interventions to restore production.
Some wells have failed to recover, resulting in substantial financial losses, according to a national daily report.
On November 13, 2024, Sui Northern Gas Pipelines Limited (SNGPL) cut gas intake from local fields by 200 million cubic feet per day (mmcfd), which has since increased to 285 mmcfd. Significant reductions include 90 mmcfd from the Sui field operated by PPL, 48 mmcfd from HRL/Ghazij by Mari Petroleum, and 50 mmcfd from fields operated by MOL, leaving several fields at risk of irreversible damage.
The reduction in gas consumption by the power sector has exacerbated system pressures. A large portion of the country’s regasified liquefied natural gas (RLNG) and local gas supply remains underutilized due to decreased electricity demand and a preference for more cost-effective generation sources such as coal, nuclear, and hydropower. The high cost of RLNG discourages its use, especially as seasonal demand declines in Punjab and Khyber Pakhtunkhwa.
The Power Division has emphasized its preference for cheaper power generation options to mitigate rising energy costs, complicating gas consumption across various sectors.
