Islamabad, November 7,2026: The federal government has introduced a new mechanism for the transparent auction of locally produced liquefied petroleum gas (LPG), under which 90 per cent of domestic production will be sold through open auctions in the presence of the media to ensure fair distribution and greater market transparency.
The decision was discussed at the first meeting of a committee established to oversee transparent LPG auctions, chaired by the Secretary of Petroleum.
Speaking at the meeting, Minister for Petroleum Ali Pervaiz Malik said addressing public concerns over LPG availability and unfair pricing was a government priority. He said the new mechanism would promote fair distribution, stabilise the supply chain and strengthen the country’s energy security.
Malik said all eligible companies would be provided equal opportunities to participate in the auctions, adding that the government aimed to improve LPG availability and ensure its supply to consumers at reasonable prices.
Under the new mechanism, local LPG producers will allocate 10 per cent of their production to government-owned marketing companies to meet demand in remote and underserved areas.
The remaining 90 per cent will be sold through transparent auctions conducted in the presence of media representatives. The committee also decided that each participating company would be allowed to purchase a maximum of 20 metric tonnes of LPG per day through the auction process.
The new auction mechanism follows the federal cabinet’s approval of a broader LPG policy aimed at easing supply shortages and encouraging competition.
Under the policy, four state-owned enterprises (SOEs) will re-enter the LPG import business to diversify supply sources and improve market availability.
The government also plans to provide subsidised LPG at rates of Rs300 to Rs350 per kilogramme to deserving households registered under the Benazir Income Support Programme (BISP).
The policy has been introduced amid shortages linked to disruptions along Pakistan’s western borders, which have contributed to a sharp increase in open-market prices, taking them well above official rates.
Separately, the government has drawn up a plan to invest approximately $1 billion in expanding Pakistan’s LPG infrastructure over the next three to five years, according to a report published by The News.
The proposed investment would cover additional import terminals, storage facilities, LPG cylinders, filling plants and transportation capacity to strengthen the country’s supply chain and meet rising demand.
A senior Petroleum Division official was quoted as saying that the investment was intended to address growing energy requirements amid declining domestic natural gas production and increasing reliance on imported fuels.
Pakistan’s existing LPG infrastructure includes approximately 100,000 metric tonnes of cumulative storage capacity, of which around 14,000 tonnes are located at seaports, with the remainder situated inland.
The country also has a fleet of approximately 2,600 LPG bowsers and nearly five million cylinders in circulation. However, the existing infrastructure is considered insufficient to meet the country’s growing energy needs.
The government’s latest measures are aimed at improving market transparency, diversifying supply, expanding infrastructure and making LPG more accessible to consumers, particularly in areas where natural gas is unavailable.
