Gas theft and leakage lead to Rs.60bn loss yearly

The national assembly’s committee on energy has been informed that gas theft and leakages are causing combined annual losses of around Rs60 billion to state-run utilities. 

During a recent committee meeting chaired by Syed Mustafa Mahmood, officials informed that approximately Rs30 billion losses each are incurred by SNGPL and SSGC due to theft and system inefficiencies.

Officials told lawmakers that losses within the limit set by the regulator are ultimately passed on to consumers. 

Committee member Gul Asghar Khan criticized the situation; he said that industrial users are often involved in gas theft while the costs are recovered from domestic consumers.

MD of SNGPL, Amir Tufail, said his company had reduced these losses to 5.27%, below the regulator’s target, which still translates to about Rs30 billion annually. 

Meanwhile, SSGC officials reported their losses had been brought down from 17% to about 10%, equivalent to roughly Rs30 billion each year.

Furthermore, the sector’s rising circular debt was also brought into question, which has reached approximately Rs3.283 trillion, warning that without reforms the financial health of gas utilities could deteriorate further.

Moreover, the committee discussed policy options including improved enforcement, transparency in funds and structural reforms.