The Economic Coordination Committee (ECC) has approved the allocation of indigenous gas for the fertilizer sector, a move aimed at ensuring a long-term supply of affordable feedstock, strengthening domestic food security, and reducing the government’s subsidy burden, according to a report published by AHCML Research.

According to the decision, three fertilizer plants — Fatima Fertilizer, Agritech, and FFC Port Qasim — which were previously dependent on expensive and subsidized RLNG, will now receive dedicated indigenous gas from Mari’s new Ghazij/Shawal reservoir. This allocation guarantees operational continuity for these plants over the long term.

Additionally, Engro’s base plant will have its gas supply secured by de-allocating 110 mmcfd from the inefficient GENCO-II power plant. The move ensures a stable supply and lower feedstock costs for Engro, supporting overall industry efficiency.

The ECC noted that the shift from RLNG to indigenous gas will significantly reduce government subsidies and circular debt, eliminating recurring fiscal pressures caused by RLNG’s higher cost. The decision is also expected to streamline payments within the energy chain and improve liquidity for state entities such as SNGPL, PSO, and PLL.

Furthermore, the new policy is expected to encourage domestic investment, as fertilizer producers — particularly Fatima Fertilizer, Agritech, and FFC — are anticipated to invest over USD 200 million in establishing processing facilities for gas from the Ghazij/Shawal reservoir, which contains a high CO₂ content.

Officials stated that the ECC’s decision reflects the government’s commitment to promoting sustainable industrial growth, reducing reliance on imported fuels, and stabilizing agricultural input costs for the long term.