Billions in Unjustified RLNG Costs Passed to Gas Users Through Tariffs: AGP Report

Gas consumers across Pakistan are bearing the brunt of flawed RLNG diversion policies that lacked proper safeguards and accountability.
The latest AGP audit report details how these practices added significant and lasting financial pressure on households and businesses.
How RLNG Costs Were Passed to Households
RLNG diversion to domestic and commercial users started in 2018 due to declining local gas production and widening supply gaps.
RLNG is significantly more expensive than indigenous gas yet was supplied at subsidised rates.
This created a growing cost differential that was later recovered through higher tariffs and subsidies.
The seasonal adjustment mechanism worked initially but collapsed as indigenous supplies dwindled and diversion volumes surged.
The government then allowed recovery of the shortfall through consumer tariffs.
This approach placed an undue burden on already strained households and commercial users.
Fixed Charges and Transparency Concerns Add to Pressure
In 2023 the government approved fixed monthly charges on gas bills to support gas companies.
SNGPL collected over Rs 117.37 billion under this head.
However, no mechanism was developed to adjust or account for these collections.
This has raised fresh questions about transparency and proper use of consumer money.
The company’s overall revenue shortfall stood at Rs 529.34 billion as of March 2025.
Despite repeated OGRA directives, the government has yet to frame any recovery policy.
The audit also flagged release of unbudgeted subsidies worth Rs 30.8 billion and diversion beyond approved categories.
Weak controls and absence of verification after 2019-20 allowed irregularities to persist for years.
The AGP has called for immediate corrective steps.
These include robust verification of subsidy claims, clear limits on subsidies and transparent financial frameworks to protect consumers and ensure long-term sector sustainability.