Power generation: SNGPL suggests suspension of gas supply to fertiliser plants

The Sui-Northern Gas Pipelines Limited (SNGPL) has recommended the government to suspend gas supply to four fertiliser plants operating on SNGPL's system so that the gas could be diverted to power plants for generating an estimated 8,00 megawatts of electricity.
Sources in the Petroleum Ministry told Business Recorder here on Wednesday that all the four fertiliser plants on the SNGPL network, Pakarab, Dawood Hercules, Engro's new plant and Agritech had already been the biggest victims of chaotic gas situation. They added that the suspension of gas supply to fertiliser plants would save over 200 million cubic feet per day (MMCFD) gas, which could be used to generate 8,00 MW of electricity.
The government preferred to import over one million tons of urea by spending a hefty amount of $783 millions from precious foreign exchange. In addition to this, the government also paid huge subsidy of Rs 54 billion on the imported urea to keep its price equal with the locally produced urea. Agriculture contributes around 24 percent of the GDP and it also provides raw materials to all the major industries of Pakistan including, textiles and sugar.
If the government accept the recommendations of SNGPL it would cause problems for Kharif Crops, as due to non-availability of fertiliser production of rice, cotton, sugarcane, maze, tobacco and other major crops would be affected. During last season, SNGPL-based fertiliser plants were badly hit and hardly managed to achieve 31 percent of fertiliser production against their installed capacity, due to unavailability of gas.
In the past winter all the four fertiliser plants on SNGPL network faced a complete shutdown, which resulted in a huge production and financial loss to these fertiliser plants. Dawood Hercules plant produced only 39 percent of urea, which stood at 199,000 tons against a production capacity of 513,000 tons.
Pakarab Fertiliser plant only produced 27 percent of urea, which stood at 29,000 tons against a production capacity of 106,000 tons. Agritech plant produced 34 percent of urea, which stood at 146,000 tons against a production capacity of 428,000 tons and Engro's new plant produced 27 percent of urea, which stood at 347,000 tons against a production capacity of 1.26 million tons.