Gas companies face huge losses as prices remain stagnant

October 31, 2023 (MLN): The gas companies have suffered a massive loss that stands at Rs879 billion, up from Rs18bn in 2013-14, due to the failure to increase the gas prices in proportion to the estimates, caretaker minister for energy, power & petroleum, Muhammad Ali, stated during a press conference today.

He added that the delay in gas price adjustment has burdened the economy and contributed to the widening of the fiscal deficit, higher borrowing, and rising interest rates.

The minister warned that if the gas price is not increased, the circular debt of the gas sector would reach Rs2.48 trillion by the end of FY24.

To note, the current circular debt of the gas sector stands at Rs2.1tr.

Muhammad Ali stated that the gas price for Tandoor has remained unchanged for a long time.

It is worth mentioning that the recently approved natural gas sale pricing for FY24 also maintains the same pricing for Tandoor without any changes.

Caretaker minister during the press conference stated that the current tariff also covers the months of July, August, September, and October.

He said that the gas companies need long-term reforms, which the caretaker setup does not have enough time to implement. Implying that the decision on this matter will be made by the elected government.

Copyright Mettis Link News