ISLAMABAD: Karachi Electric's top team is in Islamabad to seek the help of government authorities on Gas Supply Agreement (GSA) with Sui Southern Gas Company Limited (SSGCL) for supply of its committed gas to its new and existing plants.
Well-informed sources told Business Recorder that the machinery for KE's new power plant at Port Qasim has started reaching Karachi but SSGCL altered the design of the pipeline due to which the entire design of the project has changed. The machinery has already reached Karachi and now Ogra has issued the licence and the Chinese are ready to start work on the plant.
KE has asked SSGCL to conclude the signing of GSA and augment its gas pipeline network at the earliest to avoid sufferings of people of Karachi.
KE has initiated a 900 MW project for an RLNG-based power plant at Bin Qasim site, along with associated grid expansion projects. This will supplement the power needs of Karachi and add value to the economy through better and sustainable power to business and industry. The project, known as BQPS-III, includes an upgrade to associated transmission infrastructure. The first phase of 900 MW is expected to be commissioned in the last quarter of 2021.
According to SSGCL, KE dues to gas utility have reached Rs 122 billion including mark up of Rs 103 billion.
"There is no seriousness on part of the SSGCL to sign GSA and always brings the talks to a standstill on the issue of circular debt," the sources added.
KE maintains that due to reduced gas quota and power demand during winter, generation was manageable for KE but summer demand will make it necessary to operate all plants at full capacity. However, due to lower gas pressure the KE faces a loss of 150 MW to 250 MW.
The government is not giving a way out to resolve gas supply issues to the power utility and there has been no development on sale of stakes of M/s Abraaj to M/s Shanghai Electric Power (SEP), K-E lamented. CPPA-G and KE have also failed to sign Power Purchase Agreement (PPA) which is mandatory to increase supply of power to 2100 MW from existing 800 MW.
Copyright Business Recorder, 2021
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