Engro Fertilizers Limited has received formal approval from the Government of Pakistan for an enhanced and firm gas allocation from the Habib Rahi Limestone (HRL) reservoir for its Base Plant, marking a significant development for the company’s operational stability and for the broader fertilizer sector. Under the new arrangement, Engro Fertilizers will receive 105 million cubic feet per day (MMscfd) of gas, replacing the earlier arrangement under which supplies were provided on an “as and when available” basis.
The approval provides long-term clarity and certainty to Engro Fertilizers’ production planning, as gas is a critical input for urea manufacturing. In the past, fluctuations in gas availability had affected plant utilisation rates, leading to operational uncertainty and, at times, disruptions in output. With a guaranteed allocation, the company is now positioned to operate its Base Plant more consistently, supporting stable fertilizer supplies for the domestic market.
According to industry observers, assured gas availability is particularly important for Pakistan’s fertilizer sector, which plays a central role in sustaining agricultural productivity and food security. Urea demand in Pakistan remains closely linked to seasonal crop cycles, and any disruption in fertilizer production can have downstream effects on farm output and commodity prices. The government’s decision is therefore being viewed as part of a broader effort to protect the agriculture value chain by ensuring uninterrupted supply of key inputs.
In addition to approving the enhanced allocation from the HRL reservoir, the government has also put in place a contingency arrangement to safeguard supplies in the event of natural depletion at the reservoir. Under this backup plan, Mari Energies Limited has been authorised to provide supplementary gas from its Ghazij and Shawal reservoirs if required. This mechanism is designed to ensure continuity of supply not only for Engro Fertilizers but also for other priority consumers linked to the fertilizer industry.
The inclusion of a backup supply framework reflects growing recognition within policymakers that energy security for fertilizer producers is essential for economic stability. Fertilizer plants operate on continuous processes, and even short-term gas disruptions can lead to technical challenges, increased costs, and delays in restarting operations. By allowing Mari Energies to step in if HRL output declines, the government aims to minimise such risks and provide an added layer of resilience to the system.
Engro Fertilizers’ enhanced gas allocation also aligns with the company’s ongoing focus on maintaining and upgrading its production infrastructure. Stable gas flows allow for more efficient plant operations, better maintenance scheduling, and improved capacity utilisation. This, in turn, supports cost efficiency and helps the company meet domestic demand without relying on imports, which can be more expensive and expose the market to international price volatility.
The development follows recent announcements by Mari Energies Limited regarding approvals to secure gas supplies for three major fertilizer plants. Taken together, these measures indicate a coordinated approach to stabilising the fertilizer sector, which has faced repeated challenges due to gas shortages, pricing disputes, and shifting energy policies over the years.
From a policy perspective, the approval underscores the government’s intent to balance competing demands for limited domestic gas resources while prioritising sectors with high economic and social impact. Fertilizer production remains one of the most gas-intensive industrial uses, but it also directly supports agricultural output, rural incomes, and food affordability.
As Pakistan continues to manage constrained energy resources, such targeted allocations and backup arrangements are likely to play an increasingly important role. For Engro Fertilizers, the enhanced and more predictable gas supply represents a critical step toward operational stability, while for the wider economy, it reinforces efforts to secure the foundations of the country’s agricultural and food systems.
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