Murree to get cheaper LPG at cost of KP, Punjab consumers

 

Ministry sends summary to ECC for approval of Air MIX LPG plants; KP and Punjab consumers to pay additional Rs4 to 5 bn a year

ISLAMABAD: The government has carved out a plan under which the KP and Punjab gas consumers will have to pay an additional sum of Rs4 to 5 billion to ensure LPG supply to Murree at a cheaper rate.

To this effect, the Ministry of Petroleum and Natural Resources has forwarded a summary to the ECC a copy of which is available with The News. According to the summary, the Sui Northern will not be allowed to provide cheaper LPG to the dwellers of any other part of the country except Murree.

Under the LPG Air Mix plants, the dwellers of Murree (Kurbagla, Dewal, Company Bagh and Tret will be supplied LPG at Rs600 per MMBTU (million British thermal units) and the remaining Rs4,000 per MMBTU will be recovered from the gas consumers of KP and Punjab.

This means they will pay Rs4 to 5 billion in one year additional to ensure cheaper provision of LPG to Murree consumers, another document pertaining to the summary reveals. The Sui Southern and Sui Northern will not be allowed to provide cheaper LPG to the consumers of any part of the country and they will be bound to pay the full cost of LPG Air Mix.

The ECC rejected the ministry’s summary on April 11 asking for establishment of LPG Air Mix plants in hilly areas including Murree, Gilgit and AJK and directed the ministry to proceed in accordance with the LPG Policy 2016 approved by the CCI. 

Now the ministry has again placed the summary before the ECC with the ‘innovative idea’ of providing the LPG to Murree at the cost of KP and Punjab gas consumers.

According to the summary, the Ogra has advised the Sui Northern and Sui Southern to first get approval of ECC and then undertake the proposed project in Murree (Kurbagla, Dewal, Company Bagh ad Tret), Awaran and Bela at the cost of Rs1.353 billion.

The projects will be funded by both the gas companies. The tariff of the above projects would be Rs600 per MMBTU which is equal to the high slab for supply of natural gas to the domestic consumers or may be changed by the government time to time. 

However, the impact on weighted average cost of gas has been calculated in terms of five projects at Rs0.60 per MMBTU as has been worked out by the SNGPL and SSGC. Both the gas companies may also install LPG Air MIX plants in housing societies and their tariff will be at the actual cost of LPG incurred by the gas utilities plus their operational and distributional margins.

However, for the housing societies, the private sector will be free to install LPG Air Mix plants. 

Permission may also be granted by the ECC for operation of LPG Air Mix plants and construction of LPG storage by third part contractors if needed.  The ECC may also approve the 30 LPG Air Mix plants each for Sui Southern and Sui Northern.