By SKM
November 18, 2025
ISLAMABAD: In a major development for the country’s energy supply chain, the Jamshoro Joint Venture Limited (JJVL) LPG–NGL extraction plant restarted operations on Tuesday after remaining shut for more than five years — a revival expected to save Pakistan about $150 million annually in foreign exchange by reducing reliance on imported LPG.
Confirming the long-awaited restart, Associated Group Chairman Iqbal Z. Ahmed said JJVL would begin LPG deliveries within the next three days. The $250 million plant, once a key contributor to domestic LPG supply, had been closed since June 2020 due to a prolonged legal dispute over its contract with Sui Southern Gas Company (SSGC).
The dispute originated from the Supreme Court’s 2013 annulment of the original extraction agreement, prompting a decade of litigation in local courts and international arbitration. A series of arbitration rulings — several favourable to JJVL — eventually helped lay the groundwork for a negotiated settlement. The Special Investment Facilitation Council (SIFC) played a central role in steering the parties towards a resolution, which has since been approved by SSGC and endorsed at the highest policy level.
The plant’s closure proved costly for Pakistan’s economy. Between June 2020 and January 2024 alone, losses stood at Rs 94 billion, surpassing Rs 100 billion by mid-2025. The shutdown resulted in the loss of more than 317,000 tons of domestically produced LPG and 127,000 tons of NGL, forcing expensive imports that cost over $193 million. Pakistan also forfeited an estimated $86 million in potential NGL export earnings.
Officials now expect the plant’s resumption to stabilise the local LPG and NGL supply, ease pressure on foreign exchange reserves, and reduce vulnerability to global market fluctuations at a time when domestic natural gas production continues to fall.
Prior to its closure, JJVL processed 8–10 mmcfd of natural gas and produced around 400 metric tons of LPG and 120 metric tons of NGL daily — output that is expected to resume gradually as operations stabilise.
Under the revived framework, SSGC and JJVL will follow a revenue-sharing formula of 66:34, with SSGC receiving 25 percent of LPG output at OGRA-notified producer prices. Officials estimate the arrangement will generate roughly Rs 2 billion annually for SSGC.
The restoration of JJVL marks one of the most significant steps towards strengthening Pakistan’s domestic LPG supply in recent years, offering both immediate economic relief and a longer-term signal of regulatory stability. Ends
