Non-supply of gas to RPPs: government suffered Rs 1.47 billion loss: audit report

The Auditor General of Pakistan has said that the national exchequer had faced a loss of Rs 1.47 billion due to non-supply of gas to rental power plants and recommended inquiry to fix responsibility on the concerned persons. The Audit Report-2010-11 says that according to terms and conditions of rental contracts, it was responsibility of Pepco to supply gas to relevant rental power plants.
But the Pepco failed to supply gas. The contract was signed with Alstom Power Rental for 136 MW installed at Bhikki and General Electric Energy for 150 MW installed at Sharqpur. The report says that Pepco did not maintain gas supply to these rental power plants.
Resultantly, Pepco had to pay Rs 1.47 billion on account of rental charges without obtaining energy from the sellers. This caused a heavy loss to national exchequer for which responsibility needs to be fixed. The matter was taken up with the management in November 2010 and referred to the concerned Ministry on December 31, 2010.
The report says that Departmental Accounts Committee (DAC) discussed the matter in its meeting held on February 8, 2011. In the meeting, the management explained that as per natural gas allocations and management Policy-2005, the priority of these power plants came at 5th in the order. Unfortunately, the country was facing acute shortage of gas, especially in Punjab province. The supply of gas was beyond the control of Pepco/NPGCL.
Audit argued that while undertaking the responsibility of supply of gas, the constraints were not considered by Pepco, which resulted in huge loss to the national exchequer. The DAC directed the management to give revised reply with documentation within two weeks. But the requisite action was still awaited till completion of the report.