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Tuesday April 23, 2024

SSGC increases LPG procurement to offset gas shortfall

By Javed Mirza
December 16, 2020

KARACHI: Sui Southern Gas Company (SSGC) has jacked up procurement of imported liquefied petroleum gas (LPG), and issued 15 tenders for supply of locally available imported LPG with delivery windows ranging January to June 2021.

The southern gas utility supplies synthetic natural gas during high demand as an alternate to piped gas. SSGC would procure at least 37,500 metric tons LPG with the option to double or triple the procurement.

“Sealed quotations are invited for supply of imported LPG locally available in parcel size up to 2,500 tons. The company has the right to procure one or more parcels against each tender enquiry,” a tender document said.

SSGC has set up LPG-air mix plants in remote areas of Sindh and Balochistan where conventional pipelines cannot be laid. LPG is mixed with air to produce synthetic gas for onward supply to the consumers through distribution networks like natural gas.

The Liquefied Petroleum Gas Distributors Association projected the need of importing 100,000 metric tons LPG each during December, January and February to meet gas requirements of the consumers across the country.

The country is set to see severe gas crisis this season as the demand-supply shortfall is greater on the back of higher consumption, and lackluster response of liquefied natural gas suppliers for the last opened tender of Pakistan LNG Limited.

An industry official said LPG demand increases in the winter because of natural gas shortage. Every winter natural gas is hardly available in most of the country, which pushes LPG demand.

The current size of the LPG market is around 1.06 million tons per annum.

LPG production stood at 784,200 metric tons last fiscal year as against the target of 820,000 metric tons and the import remained 272,018 metric tons against the target of 300,000 metric tons.

Currently, as many as 11 LPG producers and 200 LPG marketing companies are operating in the country, with more than 7,000 authorised LPG distributors.

SSGC has already warned the government of an imminent gas shortfall to double in the coming winters as supply from five fields comes to a halt.

SSGC spokesperson told The News in September that supply from five gas fields, including Zargoun, Sinjhoro, Kunar Pasaki, Sujawal and Nurbagla stopped to cause 150 million metric cubic feet per day (mmcfd) gas shortage at present, which would increase to over 350 mmcfd in winters.

SSGC is getting around 970 mmcfd at present against the demand of around 1.2 billion cubic feet per day. The gap would exceed 350 mmcfd in winters as the demand is expected to cross 1.4 billion cubic feet per day.