Lawmakers Alarmed as Gas Circular Debt Crosses Rs3.28 Trillion

Pakistan’s gas industry is facing mounting financial stress as circular debt in the sector has climbed to Rs 3.283 trillion, officials told lawmakers on February 21, 2026.

This rising debt reflects deep-rooted inefficiencies in the system and has prompted concerns that the sector may struggle to operate sustainably without urgent reform.

The disclosure was made during a briefing before the National Assembly’s Standing Committee on Petroleum, where members were told that ongoing losses at state-run utilities contribute heavily to the debt burden.

Combined annual financial losses at the two main distribution companies, Sui Northern Gas Pipelines Limited and Sui Southern Gas Company, remain high despite recent efforts to reduce waste and theft.

Lawmakers stressed that without structural reform, especially in pricing, leak control, and operational efficiency, the debt could continue to rise and ultimately fall on consumers through higher tariffs. Some members raised the possibility of privatizing these utilities as part of broader energy sector reform.

Officials also highlighted that unaccounted-for gas due to theft and leakage is still significant, even though there have been incremental reductions.

The committee was informed that petroleum authorities are seeking development funding for other projects, including geological surveys, while discussions continue how to stabilize the sector and protect consumers from further financial strain.

Key Figures in Pakistan’s Gas Sector Debt (2025–26):

The figures illustrate the scale of the challenge facing Pakistan’s gas sector, and underline the urgency for reform discussions in parliament and within stakeholder circles.