Fertiliser industry’s gas tariff on lower side: minister

LAHORE: Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi on Wednesday said the gas tariff for the fertiliser manufacturers is already on the lower side, rejecting their criticism on its rate. 

“Gas tariff for the fertiliser sector is already low and all fertiliser companies are making good profits and paying dividends,” Abbasi said, while reacting to the fertiliser manufacturers’ statement regarding high gas prices.  Earlier, fertiliser producers termed the rise in gas prices as a serious threat to the local industry.

“The ever-increasing gas prices of over $5/MMBtu (million metric British thermal unit) are the highest in comparison with the international trends, which showed a downward slide,” the Fertilizer Manufacturers of Pakistan Advisory Council (FMPAC) said at a meeting.

Abbasi, however, argued that gas is available at Rs70/million metric cubic feet/day (mmcfd) for new fertiliser plants and Rs200/mmcfd for old plants. 

He said the Sui Southern Gas Company and Sui Northern Gas Pipelines Limited incur Rs550/mmcfd as gas cost.

Abbasi further said re-gasified liquefied natural gas is also available for the fertilizer industry, “if they wish to avail benefit of international gas prices.”

The industry’s representatives, while highlighting the industry’s contribution towards food security and the national economy, urged the government to roll back the prices of gas in line with the Prime Minister’s Kissan Package.

The problems, confronted in realising the subsidy claims for Diammonium phosphate under the Kissan package, also came under discussion at the meeting.

The participants appealed to the government to streamline the procedures for timely settlement of subsidy claims.

The council reviewed the current situation of the agriculture economy. It said the unchecked downward trends in production may have serious implications for the food security. The industry reiterated its commitment to support the government’s policies in invigorating the agriculture sector, which remains the backbone of the economy.