Government reserves 10% of indigenous LPG production for state-owned marketing companies serving remote areas, while 90% will be sold through transparent auctions.
ISLAMABAD, November 7, 2026: Pakistan has introduced a new auction mechanism for indigenous liquefied petroleum gas (LPG), limiting the daily allocation to a maximum of 20 metric tonnes per participating company to ensure fair competition and wider market access.
The decision was taken at the first meeting of the LPG Committee, held under the chairmanship of the Secretary Petroleum, following the federal government’s approval of the deregulated framework.
Federal Minister for Petroleum Ali Pervaiz Malik said the initiative was aimed at addressing public concerns over LPG availability, affordability and unfair pricing. He emphasised that the government was committed to ensuring consumers, particularly those in underserved areas, could access LPG at reasonable prices.
Under the new arrangement, indigenous LPG producers will allocate 10 per cent of their production to state-owned LPG marketing companies for distribution in remote and hard-to-reach areas. The remaining 90 per cent will be offered through transparent auctions conducted in the presence of the media.
The government expects the mechanism to strengthen the LPG supply chain, improve energy infrastructure and ensure equitable distribution while providing equal opportunities to eligible market participants.
The committee also decided that daily LPG production would be closely monitored, with production figures submitted to the Prime Minister for oversight of the country’s supply situation.
The committee comprises the Secretary Petroleum as chairman, along with the Chairman of the Oil and Gas Regulatory Authority (OGRA), managing directors of Oil and Gas Development Company Limited (OGDCL) and Pakistan State Oil (PSO), the president of United Energy Pakistan Limited (UEP), and the Director General (Liquefied Gases).
The first meeting marks a key step towards implementing the LPG auction framework approved by the Federal Cabinet on November 4, 2026.
The committee will supervise indigenous LPG auctions, review market supply arrangements and periodically assess pricing and bidding mechanisms to promote transparency and improve consumer access.