BMP demands smooth supply of gas to industry in winter

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Mian Anjum warns of severe gas crunch in coming winters, as indigenous reserves depleting,

Complaining about the energy shortages, the Businessmen Panel (BMP) of the Federation of Pakistan Chambers of Commerce and Industries (FPCCI) has asked the government to ensure smooth supply of gas during winters to the industrial consumers of Sui Northern Gas Pipeline Limited (SNGPL) and Sui Southern Gas Company (SSGC), as the government lacks a policy in this regard, compelling the industry to go for closure.

FPCCI former president and BMP Chairman Mian Anjum Nisar said that there would be no gas in the coming winters, as indigenous gas reserves were depleting at 10 percent each year and in 10 years, reliance on imported gas would be 100 percent. He said it was expected that in three to four years, the prices of LNG globally would come down and the government would be able to complete the proposed new LNG terminals.

In the oil and gas exploration, new companies were not showing interest due to the high security cost and ongoing unstable political condition in the country. The investors are waiting as they would not invest when new general election will be held next year,” he said. He further said that the proposed import of gas from Russia or Iran was not possible due to sanctions.

He said that the economic indicators, current state of affairs of economy, trade deficit, as well as, export volume was not much satisfactory, as the government had no finance to subsidize the domestic industry, unable to supply gas at $3 per mmbtu against a current purchase of $40 per mmbtu.

He said the gas loadshedding in Sindh was a result of gas distribution between industry and domestic. Unlike KP, where 80 percent gas was supplied to domestic consumers, he said, in Sindh, 60 percent gas was supplied to industries and the rest to domestic and other sectors.

He said that Sindh was producing 740 mmcfd and 110 mmcfd was being supplied from Balochistan.

He said that storage of gas in the country was expensive and that facility was not available in developed countries, however, Germany and England started working on gas storage facilities under prevailing gas crises.

Mian Anjum Nisar, while demanding smooth supply of gas to all industries without any discrimination, said that suspension of gas supply to industries would be detrimental to the national economy.

Mian Anjum Nisar warned that if the supply of gas to industries was continued to disrupt, the process of industrial production would come to a standstill. In such a case, the increase in imports will lead to deteriorating balance of trade, which will pose a serious threat to the improving economy and will also reduce local industrial production process.

He said that in order to optimally use the scarce available natural gas resource, an exercise was initiated with respect to assessing the usage of gas by Captive Power Plants (CPPs).

He was of the view that Prime Minister has also repeatedly highlighted the importance of increasing exports, but in practice the industries are suffering from the gas crisis.

Mian Anjum Nisar said that even after closing down the supply to all sectors of economy, the domestic consumers across Pakistan’s main cities are either experiencing no supply of gas or it is available at painful low pressure.

The BMP chairman said that the fear which the businessmen had been highlighting for the last many months has unfortunately proven correct. He said that natural gas in the country to all bulk consumers including power, fertilizer, industry, CNG, cement and residential consumers is supplied through the extensive network of these two gas utility companies.

With the passage of time, gas stock has decreased due to natural depletion whereas new natural gas discoveries have barely kept pace with the natural depletion and there has been no net increase in the availability of indigenous gas for the last many years. Comparing gas production of last two years, a depletion of about 9.5 percent was witnessed, registering reduction of at least 400mmcfd of gas in the system.

 

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