Govt committed to providing uninterrupted gas to export industry

  • Petroleum minister says zero-industrial units will be given Rs25 billion subsidy on gas for three months

LAHORE: Petroleum Minister Ghulam Sarwar Khan said on Monday that the government was committed to providing uninterrupted gas supply to the export-oriented industry.

Briefing the media at the Sui Northern Gas Pipeline Limited (SNGPL) Head Office, he said that the zero-industrial units would be given a total of Rs25 billion subsidy on gas for three months.

“In an effort to boost the overall exports of the country, the government is also contemplating on continuing with the uninterrupted gas supply facility to the export industry till June 2019,” he added.

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The petroleum minister said that UFG (unaccounted for gas) ratio stood at 11 per cent in SNGPL, covering Punjab and Khyber Pakhtunkhwa, while 13 per cent in Sui Southern Gas Pipelines Limited (SSGPL), covering Sindh and Balochistan.

“One per cent UFG means Rs2 billion loss to the exchequer. In this way, both the gas companies have incurred a cumulative loss of Rs48 billion,” he explained.

The incumbent government has decided to mitigate the UFG ratio by one per cent i.e. overcoming Rs2 billion loss per annum, he said, adding that SNGPL and SSGPL have been tasked in this regard.

Sarwar said that the government was reconstituting the board of directors (BoDs) of all 14 companies registered with the Ministry of Petroleum. Out of the 14 companies, he added, five were listed (with stock exchange) while nine were non-listed.

“Since the previous boards were politically manipulated, the government has decided to reconstitute them by giving proper representation to oil and gas producing provinces and private sector as well as by incorporating relevant experts, professional and qualified people into each BoD,” he said.

In the first 100 days of the government, Sarwar said the reconstitution work on BoDs has been finalised for six companies – SNGPL, Pakistan State Oil, Pak-Arab Refinery Limited Company, Pakistan Petroleum Limited, Oil and Gas Development Company Limited and Government Holdings Private Limited. The BoDs of remaining eight companies would be reconstituted within the next 100 days, he added.

To a question, he said that LNG import agreements with countries including Qatar, Iran and Turkmenistan (under the Turkmenistan-Afghanistan-Pakistan-India gas pipeline project) were very much intact. He noted that LNG price from Turkmenistan was relatively low as compared to Qatar and Iran.

Sarwar mentioned that the Peshawar region of the SNGPL showed 33 per cent (around Rs6 billion loss) of the total UGF (Rs22 billion loss) of the company, asserting that main losses were incurred due to gas theft in the oil and gas producing areas including Hangu, Kohat and Karak.

As per law, he continued, the population within the five-kilometre radius of a gas producing area should be gasified, for which the respective gas company would bear the cost of 54,000 households, while rest would be paid by the provincial government.

He said that the Khyber Pakhtunkhwa government had agreed to control gas theft by regulating these areas and by paying over and above the cost of gasification.

On a query, the minister said that SNGPL has so far terminated 10 employees who were found involved in gas theft cases.

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