Cabinet body slaps moratorium on supply of gas to industrial units

Mehtab Haider

ISLAMABAD: Keeping in view the depletion of natural gas to the tune of 400mmcfd, the Cabinet Committee on Energy (CCOE) on Thursday slapped a moratorium on supply of gas to industrial units for self-generation electricity. Top officials of the government told this scribe it was found that the natural gas has depleted from the system to the tune of 9.4 percent, translating into 400 mmcfd gas within the last two years, and the gas sector is witnessing massive shortages. In order to optimally use the scarce available natural gas, an exercise was undertaken for assessing the usage of gas by Captive Power Plants (CPPs) both by SSGCL and SNGPL. There are total 1,121 CPPs,with 362 in SNGPL and 849 in SSGCL, and total number of electricity connections stood at 976while therewere 235 CPPs without electricity connections. It is estimated that the gas/RLNG consumption requirement stood at 415 mmcfd. According to an official announcement, a meeting of the Cabinet Committee on Energy (CCOE) was held under the Chairmanship of Federal Minister for Planning, Development and Special Initiatives, Asad Umar, here on Thursday. The Cabinet Committee on Energy discussed a proposal of Petroleum Division for moratorium/discontinuation of natural gas supply for captive power generation. The proposal only applies to industries which are connected to the power grid and, therefore, have an alternative electricity source. The Petroleum Division briefed the committee that gas will continue to be supplied to all those industries where gas is being utilised as integral part of the process, or where primary utilisation is not for power generation. The new measurewill be implemented in a way that no disruption is faced by any industry. The industry not currently connected to the power grid will be encouraged to shift from the natural gas-based captive power generation to the grid. The measures would, in the short term, make around 150 mmcfd natural gas available for use in the power sector, which will replace expensive power generation on back-up fuels. In the long term, around 3,000 MW load is expected to move to the power grid, which will help reduce average cost of power as well as help in reducing the circular debt build-up. The committee approved the applicability of the policy fromthe first of February for the general industry and from the first of March for the export oriented industry. The meeting was attended by Minister for Energy Omar Ayub Khan, FederalMinister for Information and Broadcasting Shibli Faraz, Federal Minister forMaritime Affairs Syed Ali Haider Zaidi, Adviser to PrimeMinister on Finance Abdul Hafeez Sheikh, SAPM on Petroleum NadeemBabar, Abdul Razak Dawood, Adviser to the Prime Minister on Commerce & Investment and officials of various divisions.