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Tuesday March 19, 2024

PM removes MDs of SNGPL, SSGC

By Khalid Mustafa
January 09, 2019

ISLAMBABAD: Prime Minister Imran Khan has removed Managing Directors of Sui Northern Gas Pipeline Ltd. (SNGPL) and Sui Southern Gas Company (SSGC) after receiving the report of fact finding committee on gas crisis that hit the country the most on December 12 for 24 hours.

Industrial activities both in Sindh and Punjab came to standstill on December 12 on account of gas crisis. The Prime Minister had convened the meeting on December 12 and ordered the authorities concerned to probe and fix the responsibilities for the gas crisis.

Petroleum Division on the same day had constituted four-member fact finding committee headed by Ogra chairperson Uzma Adil. Qazi Saleem Siddiqui, DG (PC), Shahid Yousaf DG (Gas) and Imran Ahmad, DG (LG) were its members. Secretary petroleum submitted the report to PM with its own recommendations some days back holding Managing Directors of gas companies responsible for the gas crisis. The Prime Minister at last here on Tuesday took the action and removed SNGPL MD Amjad Latif and SSGC MD Muhammad Amin Rajput from their post with immediate effect, top official privy to the development told The News.

However, in the meeting of Cabinet Committee on Energy headed by Prime Minister Imran Khan here on Tuesday, the government has decided in principle not to extend the export subsidy to the refineries located at coastal areas for export of furnace oil, the official who was part of the meeting told The News.

However, the mid and up country refineries such as Parco and Attock refinery will be treated differently as they will have to pay on-land freight up to Karachi-port city while exporting their furnace oil. The committee has been constituted to exactly know as to whether refineries will face the loss or loss in profit while exporting the furnace oil. The government has already notified the ban on import of furnace oil for power generation. However for summer peak demand, refineries have been asked to go into agreement with furnace oil-run power houses for sale of furnace oil.

The official said petroleum division has come in the meeting with presentation on working of refineries on how to deal with furnace oil issue. In the last meeting Prime Minister had asked the refineries should come up with the plan for furnace oil export. The official said a series of meetings with refineries have been held in petroleum division and more to be held till the finalization of the business plan of refineries. The official said that Byco refinery which is located at coastal area has managed to get the export order of furnace oil and it will start exporting the product by end January. He said Pakistan Refinery Limited and National refinery Limited are also Pakistan’s coastal refineries. The official said refineries have been getting the deem duty since long, but some of the refineries have done some work towards desulphurization, and goal of complete isomerisation. However, getting the capability to change the furnace oil into refined product of diesel and other items is still a far distant dream.

The meeting headed by PM Imran Khan also touched the issue of terming the RLNG a gas product as at present RLNG is being treated as petroleum product. The government factually wants to introduce average gas price mechanism in the country by blending the local and import RLNG. Right now RLNG price is ring fenced. When it was imported by PML-N government at that time country was facing massive gas crisis.

The PML-N government was in haste to import RLNG and when the issue of RLNG pricing emerged, it was known that Ogra Ordinance did not have any definition of RLNG. For gas price determination, a formal hearing is held in which all stakeholders participated and challenged the petitions of gas companies. Since the Ogra Ordinance, there was no mention of RLNG definition. Now the government wants to declare RLNG a gas product for which Ogra Ordinance needs amendment. Parliament has to pass the amendment declaring RLNG a gas product and once RLNG becomes the gas product, then Ogras will start determining the averages gas prices through the hearings. Currently Ogra determined the average gas price of local gas fields out of which some are producing cheaper gas and some costly. RLNG will also be treated a gas from costly gas field.

Mentioning the Unaccounted for Gas (UFG) in the gas network, the official said this item has been deferred for discussion as Prime Minister had to go for other official engagement. However it was told that annually the gas of Rs50 billion gets stolen.

However, Power Division told the meeting participates that it has reduced one percent losses of electricity in the system and filed the 16000 FIRs on the theft of electricity .Power Division also briefed the Premier on economic merit order under which the power houses are run. The Power division also briefed on must-rum power houses. Likewise petroleum division also told the meeting that over 5000 gas connections have been disconnected for using the gas compressors. In the meeting Power Division has placed its demand of RLNG of over 1bcf for power sector for the months of May, June and July. Prime minister asked for more steps to end the menace of electricity theft.