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Pakistan govt overturns plan to cut gas supply to industry

Publication Date : 28-06-2012

 

The Pakistan government yesterday overturned a decision of the Sui Northern Gas Pipelines Limited (SNGPL) to cut gas supplies to the industry in Punjab from five days to four days a week.

Petroleum Minister Dr Asim Hussain issued directions to the gas company to reverse its decision on the intervention of All Pakistan Textile Mills Association (Aptma). The SNGPL had notified the gas for the industry in the province on the pretext of creating room for increasing supply of the fuel to the independent power producers (IPPs).

The industry including textile, fertiliser and power sectors in Punjab remained without gas for 200 days during the current fiscal year. The Punjab government estimates a GDP loss of 2-3 per cent to the provincial economy because of energy shortages, which have sparked violent protests by industrial workers in many cities.

“The notification has been withdrawn on the intervention of the minister and in view of violent protests by industrial workers, especially in Faisalabad, in the recent weeks,” an SNGPL official told Dawn on condition of anonymity.

An Aptma spokesman said the association’s leadership had apprised the minister of the unrest among textile workers due to the likely closure of capacities for another day a week.

In the meanwhile, the Save Industry Forum Pakistan (SIFP), an alliance of the textile, fertiliser and power producers, has proposed to the government to bring the price of CNG at par with the petrol price and close the CNG stations for 90 days in summer from July to September and 90 days in winter from December to February as a short-term solution to the energy crisis.

In a letter addressed to Dr Asim Hussain, the forum said the medium-term solution to the energy problems lay in the establishment of three LNG terminals of 500 mmcfd each with capacities of handling gas up to 1500 mmcfd and distributing it to all consumers through SNGPL or SSGC networks wherever required on the basis of weighted average price.

The long-term solution is in importing gas from Iran and Central Asia and making investment-friendly and market based policies to encourage gas exploration in the country.

The forum appreciated the role and vision of Dr Asim to end energy shortages in Pakistan and urged him to take the crucial decision of stopping waste of “most precious natural resource of 500 mmcfd gas in CNG consumptions for cars of the wealthy”.

It said the government was providing a subsidy of Rs50 billion on CNG at the cost of 10 million jobs, US$4 billion exports and fresh investment.

“On the other hand, the gas-based power plants producing electricity through diesel are costing Pakistan 300 billion rupees ($3.17 billion) because of inefficient use of 500 mmcfd gas in CNG. This could be brought down by diverting gas from CNG sector to the power producers,” it said.

The forum points out that Pakistan is facing gas shortfalls in winter up to 1,500 mmcfd, which results in the closure of all the industries in Punjab and 500 mmcfd in summer resulting in two days closure every week for the industry.

 

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