SNGPL Faces Severe Liquidity Crunch Over Rs 174 billion Power Sector Dues
Sui Northern Gas Pipelines Limited (SNGPL) reports outstanding receivables of about Rs 174 billion from power generators, straining its cash flow and ability to meet supplier payments.
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Desk Analysis
How This Affects the Exchange
Sector Effect
Negative · Do not buy
Oil & Gas sector faces cash‑flow strain due to large power‑sector receivables; avoid buying SNGPL (ISL) until resolution.
Sectors & Direction
Desk read
Desk call: Do not buy · Negatively affected
- Oil & GasNegatively affected
Companies
Companies Mentioned
- ISL· Negatively affected · Do not buy
Mentions in This Briefing
Sectors: Oil & Gas — Negative · Do not buy. PSX tickers: ISL. Oil & Gas sector faces cash‑flow strain due to large power‑sector receivables; avoid buying SNGPL (ISL) until resolution.
Full Story
Open on Business Recorder## Overview
Sui Northern Gas Pipelines Limited (SNGPL) disclosed a critical liquidity shortfall stemming from unpaid dues amounting to roughly Rs 174 billion owed by power sector entities. The shortfall is primarily linked to delayed fund releases by the Central Power Purchasing Agency‑Guaranteed (CPPA‑G).
## Breakdown of Receivables
- Total receivables from power sector: Rs 173.654 billion. - Government‑owned power plants: Rs 60.989 billion, including Rs 21.497 billion in undisputed gas charges and Rs 34.173 billion in late‑payment surcharges. - Key government plants with large arrears: Guddu Power (Rs 35.240 billion), Nandipur Power (Rs 21.303 billion), QATPL (Rs 32.228 billion), Balloki Power (Rs 23.737 billion). - Independent Power Producers (IPPs): Rs 36.969 billion, with major exposures to KAPCO (Rs 5.118 billion), Liberty Power (Rs 20.840 billion), and others. - Rented WAPDA units (Bhikki & Sharaqpur): Rs 0.365 billion combined.
## Liquidity Impact
SNGPL’s General Manager (Recovery) warned that the prolonged delay in payments has severely constrained the company’s cash position, limiting its ability to settle obligations to upstream gas suppliers and other creditors. The firm has appealed to the Director General (Gas), Petroleum Division, to intervene with the Power Division for prompt fund releases.
## Potential Consequences
If the outstanding amounts remain unpaid, SNGPL may invoke contractual recovery rights, which could affect gas supply contracts and trigger broader operational disruptions in the gas transmission network.
## Outlook
The situation underscores the inter‑dependency between the gas transmission sector and the power generation segment. Timely resolution is essential to restore SNGPL’s liquidity and maintain stability in Pakistan’s energy supply chain.