The Ministry of Petroleum is planning on increasing gas prices by up to 60% in order to curb the revolving debt of the gas sector, which is one of the conditions set by the International Monetary Fund (IMF).
According to the details, a national gas price will be set for the entire country, which means consumers will be charged similarly regardless of where they live.
The current price of local gas is $8 per MMBtu, while the price of imported LNG is $13 per MMBtu and the government plans to close the gap between the two prices, which is expected to help reduce the revolving debt.
Under the new plan, the government also plans to reduce amount of LNG for fertilizer production. At the moment, fertilizer producers are given LNG at a discounted rate and the government plans to cancel that discount, requiring them to pay full price.
However, the plan will be implemented after the approval of the Federal Cabinet and consultations with all provinces. Once implemented, the plan will have a significant impact on gas consumers, who will see their gas bills go up just like what’s happening with electricity bills at the moment.
Read more: Petrol Prices Expected to Get Massive Hike From September 1.
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