No gas for CNG, industrial sectors in winter: Abbasi September 24, 2014 ABDUL RASHEED AZAD Federal Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi has said that there will be no gas supply for industrial and Compressed Natural Gas (CNG) stations in the upcoming winter due to gas shortage and high demand by the domestic sector. He said that the government would give top priority to domestic users in the winter and like in the past year this time around too CNG and industrial sectors would have no gas for at least three months, adding that in case Liquefied Natural Gas (LNG) terminal at port Qasim being constructed by Elengy Terminal Pakistan Limited was becoming operational in January 2015, the government would be in a position to supply some quantity of gas to industrial sector. He said that as per contract with Elengy Terminal Pakistan Limited, the terminal would be completed by end March, but owing to serious gas shortage the government had urged the company to complete the terminal as early as possible, hence the ministry was hopeful that the terminal would be ready by the end December 2014 and the first LNG supply would come in January 2015. The minister said that the government had also decided to construct a LNG terminal at Gwadar port with a capacity to handle up to one billion cubic feet per day LNG (BCFD) and to transport this gas to upstream country a 700 kilometers long gas pipeline would be built up to Nawabshah. He said Japan, Russia and China had shown a great interest in the building of LNG terminal at Gwadar port. If sanctions against Iran were being lifted any time in future, the gas pipeline from Gwadar would be extended by 70 kilometers to link it with Iran for transporting gas under Iran Pakistan gas pipeline project, the minister maintained. Abbasi said that the government of Pakistan was committed to completing the Iran- Pakistan (IP) gas pipeline, but only hurdle was US sanctions against Iran, adding that once sanctions against Iran were lifted Pakistan would immediately start the construction of the pipeline. The minister said that the President of Pakistan would issue an ordinance for the collection of Gas Infrastructure Development Cess (GIDC) which was suspended by the Islamabad High Court and Peshawar High Court and the government had field a review petition in the Supreme Court (SC) of Pakistan against the decisions of high courts. He added that the government had also decided to table a bill in the parliament on the issue of the GIDC, which would be used to build gas infrastructure especially LNG, LPG, IP and TAPI gas pipelines projects. The minister said that from 2011 to date the government had collected Rs 80 billion on account of the GIDC and about Rs 25 billion were outstanding against different gas users. He said that the government had allowed CNG sector to import LNG for replacing local gas which would be proved a game changer as it would save $2.5 billion per annum in oil imports and ensure employment to about one million people. Abbasi said gas utilities - Sui Northern Gas Pipelines Limited and Sui Southern Gas Company - would provide infrastructure for transporting 500 million cubic feet of LNG per day (mmcfd) to CNG filling stations. Gas supply to CNG stations would be for seven days a week and CNG would be 30% to 35% cheaper than petrol, he said, stressing Pakistan had a wide infrastructure network in place for CNG pumps and provision of LNG would lead to consumption of clean energy. The minister stated that the prices of the petroleum products were likely to reduce from October 1, 2014. According to petroleum officials, the price of petrol is likely to decrease by Rs 0.70 per litre whereas the rate of high octane blending component may be slashed by Rs 1.80 per litre. The price of high speed diesel may be decreased by Rs 0.87 per litre and the rate of kerosene is likely to go down by Rs 0.45 per litre. Light diesel price is likely to reduce by Rs 0.77 per litre, sources said. Talking about Unaccounted for Gas (UfG) losses the minister said that currently it stands at around 10 per cent, eating up to 400 mmcfd of natural gas and on this account the country suffers an estimated Rs 25 billion loss per year. The minister made it clear that LNG price would depend on market forces, ruling out any role for the Oil and Gas Regulatory Authority (Ogra) in that regard. However, he said, it would be 30% to 35% cheaper than petrol and the government would give tax relief to make it affordable for the consumers. It will take 18 months to induct LNG into the CNG industry. He said that the government has made it clear for those industrialists producing power by using industrial gas from now onward they will have to use separate meters for industrial and power production purposes. The government has imposed Rs 200 per MMBtu as Gas Infrastructure Development Cess (GIDC) on Captive Power Plants installed at different industrial units. The government will increase gas prices for all the sectors of economy excluding domestic consumers. The minister said that all the Chief Executive Officers (CEOs) will be appointed by the Board of Directors of the company and the government will not interfere in this process. Copyright Business Recorder, 2014
Posted on: Wed, 24 Sep 2014 03:46:19 +0000
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