Pakistan’s gas sector is facing a growing supply and financial challenge as domestic gas production continues to decline. According to a new study by Pakistan’s Credit Rating Agency (PACRA), indigenous gas production could fall from around 2,634 million cubic feet per day (MMcfd) in FY2024 to nearly 1,266 MMcfd by FY2034.
This would significantly increase Pakistan’s dependence on imported energy. PACRA estimates that the share of domestic gas in total supply could decline from approximately 73% to just 25% over the next decade. While proposed structural reforms may improve efficiency in the long run, they are unlikely to solve the sector’s financial challenges immediately.
At the same time, LNG demand has weakened, with imports falling from around 6 million tonnes to approximately 3.7 million tonnes during the first nine months of FY2026. Increased use of solar power and other alternatives by industrial and power-sector consumers has contributed to the decline.
Long-term pipeline projects, including TAPI and the Iran-Pakistan pipeline, could potentially diversify Pakistan’s gas supplies. However, continued delays mean they are unlikely to address the country’s immediate energy requirements.
The financial condition of SNGPL and SSGC is another major concern, with delayed tariff adjustments, weak recoveries and rising working-capital needs putting pressure on their liquidity.
There is, however, some positive news from the LPG market. Local LPG production reportedly increased by 15.5% in FY2026, while imports declined by 12%.
Can Pakistan reduce its future gas shortage through domestic production, renewable energy and better sector reforms?
