ISLAMABAD: Sui Southern Gas Company Limited (SSGCL) has sought help from Petroleum Division for resolution of KE’s Tariff Differential Subsidy (TDS) issue that would enable the power utility to pay its gas bills.
On July 27, 2022, in a letter to Secretary Petroleum, Ali Reza Bhutta, Managing Director SSGCL, Imran Maniar shared previous correspondence with KE and Petroleum Division, in which SSGC noted KE’s continued default in making RLNG bill payment to SSGC and subsequently obtained a Stay Order from Sindh High Court against encashment of Bank Guarantees.
Petroleum Division was informed that Moonis Alvi, CEO, KE visited SSGC offices on July 22, 2022 and held a meeting with SSGC management in which KE assured the gas utility company that it would release Rs 5 billion plus Rs 2 billion against RLNG bill payment during the current week, to maintain overdue amount at Rs 18 billion, and will be paying current bills, subsequently.
He also requested for increase in indigenous gas supplies from 10 MMCFD to 20 MMCFD, which is not possible for SSGC with current indigenous gas supplies numbers. However, SSGC had not received payment from KE till July 27, 2022.
In case KE honours its commitment, and SSGC receives Rs. 7 billion from KE, the SSGC receivables would be reduced to the level of Rs. 18 billion.
For clearance of remaining receivable of Rs 18 billion, SSGC management requires Petroleum Division’s intervention to take up the subject matter with Ministry of Finance and ECC for early resolution of KE Tariff Differential Subsidy (TDS).
SSGCL argued that release of KE subsidy would enable KE to clear its dues to SSGCL which would be paid to SNGPL for onward remittance to PSO to save it from international default.
The Petroleum Division is well aware of the fact that SSGCL is severely trapped in circular debt crisis. Moreover, liquidity issues including non-receipt of payment from industrial consumers like KE has severely affected RLNG supply chain and its effects are so severe that PSO is on the verge of international default and only KE’s timely payment can resolve this grave issue.
Copyright Business Recorder, 2022