Fertilizer Companies to Renew Gas Contracts in June With Rates Likely to Rise

Contracts for purchasing affordable gas for fertilizer plants are set to expire in June 2024, sources told ProPakistani. The Ministry of Finance has directed the Energy Division to negotiate new terms for a quick resolution of the matter. Sources added that these new contracts will be subjected to conditions set by the International Monetary Fund (IMF). Sources within the Finance Ministry indicate that the existing agreements providing cheap gas to nine fertilizer plants will expire in June 2024. Under new contracts, the cost of gas for these plants will range from Rs. 760 to Rs. 1,750 per MMBtu. Specifically, five of these fertilizer plants are anticipated to receive gas for their fertilizer production needs at rates varying from Rs. 580 to Rs. 760 per MMBtu. Meanwhile, for operating machinery, the gas prices are set to range from Rs. 1,580 to Rs. 1,750 per MMBtu. Sources mentioned that Fatima Fertilizer and Agritech will be able to purchase gas at a rate of Rs. 1,597 per MMBtu for their fertilizer production. These adjustments in gas rates are expected to come into effect in the upcoming fiscal year.