Balochistan: PM body to examine causes behind SSGCL’s high UFG losses

ISLAMABAD: Prime Minister Shehbaz Sharif has constituted a high-powered committee to ascertain the causes of unusually high Unaccounted-for-Gas (UFG) losses of Sui Southern Gas Company Limited (SSGCL) in Balochistan and recommend short and long-term measures to enable the company to sustain its operations in the province, well-informed sources told Business Recorder.

The committee, headed by Deputy Prime Minister and Foreign Minister Ishaq Dar, has been tasked with examining the factors behind SSGCL’s persistent UFG losses in Balochistan and proposing corrective measures to bring them within the benchmark prescribed by the Oil and Gas Regulatory Authority (OGRA).

According to sources, the committee comprises Rana Sana Ullah Khan, Adviser to the Prime Minister on Political and Public Affairs and Inter-Provincial Coordination; Jam Kamal Khan, Minister for Commerce; Khalid Hussain Magsi, Minister for Science and Technology; Rana Mubashar Iqbal, Minister of State/Minister for Public Affairs Unit; Ali Pervaiz Malik, Minister for Petroleum; Secretary Petroleum Division; Secretary Ministry of Interior and Chief Secretary Balochistan.

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The formation of the committee follows concerns raised by the Petroleum Division regarding the growing UFG losses of SSGCL in Balochistan and their impact on the financial sustainability of the gas utility.

The Terms of Reference (ToRs) require the committee to examine issues highlighted by the Petroleum Division before the Prime Minister’s Office on July 14, 2026.

It will also conduct a detailed analysis of SSGCL’s UFG losses in Balochistan during the four-year period from fiscal year 2022-23 to FY2025-26 and determine the underlying causes of the losses.

The committee has further been directed to examine whether SSGCL’s Estimated Revenue Requirements (ERR) for FY2026-27 are commensurate with the company’s actual UFG losses in Balochistan.

The issue is significant because UFG represents gas that enters the distribution system but is not accounted for through billed consumption. Such losses can arise from technical factors, leakages, inaccurate metering and other operational issues, as well as theft and unauthorized consumption.

For a gas utility, excessive UFG can create a substantial financial burden because the cost of gas lost from the system has to be absorbed somewhere within the supply chain. Persistent losses can consequently affect the company’s revenue requirements and place additional pressure on the broader gas-sector finances.

Under the ToRs, the committee will recommend short-term measures to address SSGCL’s UFG losses in Balochistan and enable the company to continue and sustain its operations in the province.

The committee will also formulate long-term measures aimed at reducing UFG to the benchmark level prescribed by OGRA. This indicates that the government intends to address the issue not merely through immediate financial support but also through structural and operational reforms.

The committee’s findings are expected to provide the government with a clearer assessment of the reasons for SSGCL’s high UFG losses and the extent to which these losses are attributable to technical, commercial, security or other factors.

The review of the company’s ERR for FY2026-27 is also expected to be important in determining whether its revenue requirement adequately reflects the actual cost implications arising from UFG losses in Balochistan.

Balochistan presents particular operational challenges for the gas distribution network, including its vast geographical spread and security-related difficulties. The committee will therefore assess the issue comprehensively before recommending measures to the federal government.

The government has directed the committee to undertake the review and recommend measures that can both provide immediate relief to SSGCL and establish a sustainable framework for bringing UFG losses in Balochistan within the regulatory benchmark.

Copyright Business Recorder, 2026