SSGC oversupplying gas to K-Electric

KARACHI: Sui Southern Gas Company (SSGC) is currently supplying 70 to 100 million metric cubic feet per day of gas to K-Electric despite that sales agreement covers only 10 mmcfd, the spokesperson said on Monday.

SSGC spokesperson Shahbaz Islam said SSGC has always provided much more

gas to KE than the gas sale agreement- (GSA) allocated amount to avert power outages in the city, despite less gas being injected into SSGC’s system from the gas fields.

“SSGC has provided 270 mmcfd plus gas to the power company in summers this year due to greater demand for gas when KE failed to arrange alternate fuels for power generation,” Islam said in a statement.

“The main reason behind no progress of signing GSA was always due to KE reluctance to abide by CCOE [cabinet committee on energy] decision of April 2018.” The spokesperson said the National Electric Power Regulatory Authority (Nepra) initiated investigation of power outages in Karachi and has submitted a report.

Earlier in 2018, Nepra also conducted an inquiry and report of reasons of excessive load shedding is available on records.

“SSGC is committed towards ironing out points of contentions with K-Electric and already started negotiations on the supply agreement despite the fact that over dues K-Electric owes to the gas utility reached to Rs122 billion, a figure on which the latter does not agree with,” he said.

“However, SSGC has always maintained that the long pending issue of growing over dues need to be sorted out before the company inks a fresh GSA with KE.”

In April 2018, SSGC and K-Electric reached an amicable solution of the issue in pursuance the CCOE’s decision wherein it directed for the finalisation and signing of terms of references for the settlement of dues between SSGC, K-Electric and Karachi Water and Sewerage Board.

The terms of references were initialed by the SSGC and KE in April 2018 and it was decided to engage an independent reputable chartered accountant firm for the purpose.

While SSGC had sent the signed document to KE in August that year, KE is still reluctant to counter-sign the same. “In fact, in June 2018, KE went to the Sindh High Court when SSGC exerted pressure on KE to execute the TORs for reconciliation.”

Islam said SSGC has referred the matter of implementation of CCOE decision once again to the concerned quarters. “SSGC is committed to work towards the resolution of all outstanding issues and provide full cooperation.”