Sunday December 04, 2022

Shake-up expected in Petroleum Division in coming days

September 29, 2022

ISLAMABAD: Since the new government has taken charge, the Petroleum Division has failed to perform and no movement on major issues is visible while the winter season is only one month away.

“An important personality of the government looking after the energy sector, bestowed with powers now, has recommended to prime minister to replace the incumbent secretary with an innovative person and doer,” one of the top men in the government told The News. “Reshuffling of other senior officers who believe in ‘look busy, do nothing’ formula is also on the cards.”

The secretary, the source said, has not submitted any summary in the ECC on advancement on important issues on changing present boards of many SOEs (SNGPL, SSGC, OGDCL, ISGS, PLL and PPL). These boards are not capable of taking hard decisions. “Their change is necessary to turn the sector around, removing impediments in setting up new LNG terminals in the private sector at Port Qasim,” he said.

The source said they were looking at strict commitment of a timeline for allowing utilisation of excess capacity of the existing LNG terminals, increasing local LPG production, including through restart of JJVL LPG plant, activating all marginal fields to encourage increased local gas production and immediate start on bifurcation of Sui companies into transmission and distribution companies and privatising distribution companies.

The business as usual in the Petroleum Division with no advancement on the above-mentioned issues will result in massive gas loadshedding in the winter season. Also, most of the 33 million people affected by the catastrophic flood are still living under the open sky and there is no dried wood and dry dung of animals available to them to cook food and keep themselves warm.

The wood and livestock have vanished, washed away with the waves of the flood. Only option the government has is to start the JJVL LPG plant and start providing one cylinder at cheaper rates to each family affected by the flood. But the Petroleum Division is unmoved on this very issue.

The top government functionaries are also quite irked with the secretary Petroleum Division for scuttling the deal done between Pakistan LNG Limited (PLL) and Pakistan Gasport Consortium Limited (PGPCL) on using the additional capacity of the LNG terminal-2 under TPA rules.

The secretary petroleum placed new terms and conditions, which have virtually scuttled the PGPL-PLL deal signed on August 3, 2022. The coalition government wanted the implementation of the contract as it will help the private sector to bring one LNG cargo a month under BtB mode and to this effect an important personality facilitated both PLL and PGPCL to ink the agreement.

Right now, Pakistan is relying on term cargoes which are 8-9 in numbers each month from November to January, depending upon the availability of one cargo from ENI. PLL has failed to allure any bidder for spot cargoes. With the winter season that has set in Europe, LNG in the spot market is non-available at reasonable rates as all the LNG cargoes have been purchased by the EU countries at higher prices.

When asked if the government is using the option to ask Qatar to reschedule some LNG cargoes from the coming summer season in 2023 to the winter months of November, December and January so that the country has enough LNG cargoes in winter to cater to gas demand of all sectors, the official said the country needs more LNG in the summer season, May-June-July, for maximum electricity generation and cannot afford to go for electricity crisis in the summer season when the general elections will be around. He also said that in the winter season, there will be a massive gas crisis.

The News approached secretary petroleum for his version over the expected move to replace him because of zero progress on above-mentioned vital issues, which are imperative to fix the energy problems, but he didn’t respond.