Sindh government held responsible for gas shortage in Karachi: Gas sector circular debt swells to Rs 250 billion: Ayub

ISLAMABAD: The circular debt of the gas sector swelled to Rs250 billion and the Sindh government is responsible for gas shortage in Karachi. The Petroleum Minister, Omar Ayub, said this in a joint conference along with Special Assistant to Prime Minister (SAPM) on Petroleum Nadeem Babar, here on Thursday.

The minister said that circular debt in gas sector reached Rs250 billion due to absence of weighted average price, adding that a gas conference was held in the PM's office following recommendation of the Council of Common Interests (CCI) to build consensus on weighted average gas prices.

Responding to a question regarding gas crisis in Sindh, he held the Sindh government responsible. Accusing the Sindh government, he said the provincial government did not cooperate in providing right of way to build pipeline from Port Qasim, despite raising issue for last one and half years.

He maintained that now the matter went beyond Article 158 of the Constitution that gives right to the gas producing provinces to use its local gas first. Responding to another question regarding electrocution of human lives during rains in Karachi, he said that majority shareholders were from the private sector.

However, he accused the Sindh government for backing K-Electric, and said that member Nepra from Sindh had played a key role in reducing fine imposed on KE. Nadeem Babar revealed that there would be shortage of 250-400 mmcfd system gas of the Sui Southern Gas Company (SSGC) that would affect the consumers including industry and domestic.

He maintained that Sindh province was not ready to consume RLNG and weighted average gas price was the only option. There will be no option other than rationing of gas for different sectors in Karachi, he said, however added that domestic sector would be given priority in providing gas during three times cooking hours.

If the Sindh government cooperates in giving right of way to build pipeline, the federal government was ready to complete the pipeline by end December 2020, he said. Two LNG terminals were handling 1.2 bcfd LNG that would be enhanced to 1.3 bcfd gas after completion of pipeline.

He said that the SNGPL would also be facing a gas shortage of 300-350 mmcfd in peak winter season, and therefore, there would be no possibility of diverting RLNG to SSGCL system. Babar said that previous government had now awarded a single block during five years and its impact would continue reflecting during coming three years.

He said that the PTI government had conducted auction of 10 blocks and now planned to announce auction of 20 blocks in the first week of October. He said that annual depletion of raw gas was nine per cent and it comes to six per cent after induction of new discovery of gas.

He said that 26 discoveries of gas had been made during the last 24 months to add 250 mmcfd in the system. He added that there had been depletion of 400 mmcfd. Responding a question regarding a report of PM Inspection Commission, he said that report was not based on actual data.

The Petroleum Division had invited Inspection Commission team to build consensus of data that was rectified. He said that live data transmission of wells had been active and the Oil and Gas Regulatory Authority (OGRA) had access to it. Responding to question about the GIDC, Nadeem Babar said that four parties including the APTAMA, CNG, fertilizer had filed a review petition in the Supreme Court.

He further said that that APTAMA had obtained stay order from Lahore Court on calculation of the GIDC. He further said that both gas companies the SNGPL and the SSGC included amount of the GIDC in bills of September for recovery in 24 installments.

Copyright Business Recorder, 2020