Over­com­ing gas short­age in Sindh

The Financial Daily - - MONEY & FOREX -

Sui South­ern Gas Com­pany (SSGC) has in­formed the con­sumers that gas sup­ply from Bhit field, sup­ply­ing 345 mm­cfd would be cur­tailed up to 60 per cent for 24 days, start­ing from April 11 to May 4 on ac­count of its an­nual turn around. It has also re­quested the con­sumer to con­tain us­age and wastages for avoid­ing pro­longed hours of load shed­ding. SSGC sought co­op­er­a­tion of con­sumers as and when any of the field sup­ply­ing gas closes or cur­tails sup­plies dur­ing an­nual turn around. Tak­ing the con­sumers in con­fi­dence has kept con­sumers' woes at the min­i­mum and caused least dis­rup­tion in eco­nomic ac­tiv­i­ties.

Ini­tially, ENI had planed com­plete shut­down of the field but SSGC was able to per­suade it to main­tain sup­plies through at least one pro­duc­tion train thus en­sur­ing at least 40 per cent sup­plies to which ENI also agreed. De­spite that SSGC would have to un­der­take load shed­ding to meet the short fall of more than 200mm­cfd. The three bulk cus­tomers which are likely to be most af­fected would be WAPDA, Fauji Fer­til­izer Bin Qasim and KESC as their gas sup­plies would be cur­tailed. SSGC has al­ready in­formed these cus­tomers well ahead to make al­ter­na­tive ar­range­ments.

How­ever, one point must be kept in mind that power gen­er­a­tion com­pa­nies have the sec­ond op­tion but fer­til­izer com­pa­nies have no op­tion but to run the plant at lower ca­pac­ity uti­liza­tion. It must also be kept in mind that any cur­tail­ment of gas sup­ply to fer­til­izer plants has two ad­verse out­comes 1) no sub­stan­tial in­crease in power gen­er­a­tion is achieved and 2) waste of for­eign ex­change on im­port of fer­til­izer and also pay­ment of mil­lions of ru­pees sub­sidy. The cost of im­ported urea is al­most dou­ble the cost of in­dige­nously pro­duced one.

Sim­i­larly, run­ning of KESC's power plants on fur­nace oil dur­ing re­duced gas sup­ply be­comes puni­tive for con­sumers. There can't be two opin­ions that run­ning ther­mal plants on fur­nace oil is more ex­pen­sive as com­pared to op­er­at­ing on gas. There­fore, res­i­dents of Karachi will not be wrong in de­mand­ing the fed­eral and/or pro­vin­cial gov­ern­ments to pay the dif­fer­ence be­tween cost of fur­nace oil and gas.

Some crit­ics may op­pose the idea but they must take into ac­count that one of the key rea­sons of high pil­fer­age of elec­tric­ity in the coun­try is high elec­tric­ity tar­iff. It is on record that per­sis­tent hike in tar­iff has pro­lif­er­ated elec­tric­ity theft. There­fore, mak­ing the cost affordable will en­cour­age the con­sumers to get their con­nec­tion reg­u­larised and also pay the bills.

Con­sumers, in their own in­ter­est must also con­serve gas to con­tain its load shed­ding. They must also keep in mind that if they do not con­serve gas they could also face sit­u­a­tion sim­i­lar to the one faced by the con­sumers in Pun­jab. Last but not the least the gov­ern­ment must fi­nal­ize im­port of gas to over­come the sea­sonal short sup­plies.

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