Gas shortages, difference between prices: PM's disquiet sets off alarm bells
ISLAMABAD: Prime Minister Imran Khan on Wednesday said that difference between domestic and imported gas prices had started creating circular debt in gas sector, and expressed concern that gas shortage would continue to increase every winter owing to depletion of domestic gas reservoirs. Speaking at a seminar on "Sustainability, Security and Affordability of Natural Gas Supply in Pakistan", the prime minister said that gas crisis would be severe in the next winter. The prime minister said there was a big difference in the price of domestic gas and the imported gas, and pointed out that 27 percent of domestic households had access to piped gas, while remaining had been using LPG cylinders, which was four times more expensive than the piped gas.
He said the subsidy should be such that facilitates the poor lot.
The prime minister expressed the hope that huge saving would be made as a result of negotiation with the IPPs, and emphasized the need to watch the country's interest.
He further stated that agreement with the Independent Power Producers (IPPs) for renegotiating the contracts would be very beneficial for the country. He said that the government would inform the people by next week about the savings to be accrued on account of renewal of contracts with the IPPs.
The prime minister said that he expects that the conference to initiate a debate on the issue while keeping in view the future challenges and conclude on developing a consensus on way forward.
The prime minister said that due to bad decisions and agreements in the power sector, the industry had been suffering, and cited example of China whose development secret lies in meritocracy and long-term planning.
The prime minister regretted that no attention was paid to exploit the potential of hydel power whether in democratic or military rule to produce cheaper electricity.
The stakeholders from all the provinces demanded the federal government to ensure representation in the Oil and Gas Regulatory Authority (OGRA), which had responsibility to deal with gas prices.
During the energy moot, Imtiaz Shaikh, Minister for Energy Sindh demanded provincial representation in the OGRA and in Intra-State Gas Company (ISGC) established by the centre.
The minister maintained that no representation of provinces at forums such as OGRA and ISGC, the federal government's decision with regard to gas bears no standing.
Energy Ministers for Punjab and Khyber-Pakhtunkhwa also seconded the proposal made by the Sindh Energy Minister, and said, it was imperative to include provinces' voice into the decision-making forum on gas tariff.
Quoting Article 158 of the Constitution of Pakistan, Imtiaz Shaikh stated even though Sindh produces 62 percent of the gas, and ensured in the constitution, Sindh is being forced to buy RLNG on exorbitant prices.
The Sindh energy minister also emphasized that Sindh's rural areas were facing up to 18 hours of load shedding, which had impeded rural Sindh's economy. He demanded that the federal government should devise a mechanism to end long hours of load shedding forthwith, which was a serious cause of concern among the population.
Copyright Business Recorder, 2020