By Mushtaq Ghumman

ISLAMABAD: The federal government has altered gas management plan to increase gas supply to power sector by 71 per cent to 325 MMCFD from 190 MMCFD, suspension of gas supply to general industry in Punjab and KP per day on rotational basis and restoration of 75 MMCFD gas to Captive Power Plants (CPPs) for the Punjab-based export-oriented industry from December 29, 2021 (today).

The decision was taken on December 28, 2021, at a meeting between Advisor to Prime Minister on Commerce and Investment, Abdul Razak Dawood and Secretary Petroleum Ali Raza Bhutta.

According to official documents, in order to review system status, a meeting of load management committee was held on December 28, 2021, wherein deliberations were made on load management across the network and it was agreed that pursuant to meeting held on December 27, 2021, chaired by PM Advisor on Commerce and Investment and attended by Secretary Petroleum, gas supply to textile captive power units shall be restored from December 29, 2021. As agreed in the meeting, a volume of 75 MMCFD (38 per cent of average consumption of textile captive power units for the period from September 2021 to November 2021) shall be supplied to this sector;(ii) gas supply to textile captive power units shall be restored after obtaining undertaking on the format and withdrawal of court cases as mentioned in the undertaking.

It was also decided that gas supply of general industry (non-export) shall be suspended for one day per week in rotational manner on region-wise basis as per the following schedule:(i) Monday (Lahore East and West;(ii) Tuesday (Sheikhupura & Sahiwal;(iii) Wednesday (Faisalabad & Sargodha) ;(iv) Thursday (Multan & Bahawalpur;(v) Friday (Gujrat, Sialkot and Gujranwala;(vi) Saturday (Rawalpindi, Islamabad & Abbottabad and;(vii) Sunday, Peshawar & Mardan.

Gas supply to power sector shall be increased from 190 MMCFD to 325 MMCFD for the period from December 29, 2021 while 100 MMCFD/ day may be added in the daily pack for this period.

The government has also decided that strict vigilance may be carried out and action will be taken against those consumers found involved in the violation of curtailment.

On December 21, 2021, during the federal cabinet meeting, Minister for IT & Telecom raised the issue of severe gas load shedding in Karachi. The Minister for Energy apprised that the Sindh High court had granted stay against shutting off gas to general industry; resultantly, the planned diversion to domestic consumers could not be implemented. Alluding to his meeting with APTMA, the Adviser to the Prime Minister on Commerce & Investment highlighted the curtailment of gas supply to the export sector, especially the textile industry, which caused decline in production.

The Minister for Energy clarified that only gas to inefficient captive power plants had been discontinued but majority of these units have switched to electricity from the grid. The process gas to the entire textile industry was being supplied uninterrupted. It was noted that a survey of the ground situation was conducted which revealed that only 1-2 per cent textile mills were closed down due to gas shortage and those were smaller ones. Prime Minister directed the Minister for Energy to hold a meeting with Adviser to the Prime Minister on grievances of APTMA.

The sources maintained that APTMA, in its letter to Prime Minister, said that the Ministry of Energy had assured the Punjab export sector of continued gas supply provided they agreed to increase the price to $ 9 per MMBTU from $ 6.5. APTMA agreed to this in the presence of Abdul Razak Dawood. Subsequently, the Ministry of Petroleum presented a Gas Management Plan to the CCoE on December 2, 2021 which stated that gas to Captive Power Plants (CPPs) whether co-gen or not would be load shed starting December 15. According to APTMA, the Punjab-based industry was thereby hit with a double whammy, i.e., increase in gas price at $9, double that of Sindh & KP, and load shedding from December 15, 2021.

According to APTMA, all efforts will be made to further increase the supply of Gas to the Export sector.

Assuring a sustainable continuity of gas supply will go a long way for the export sector achieving maximum production & capitalizing on export orders. These measures will support industry to meet the export target of $21 billion for 2022.

Subsequently, APTMA delegation met the Finance Minister Shaukat Tarin, who assured them of adequate gas supply, working capital and easing their refund mechanism.

This article first appeared in Business Recorder on December 29, 2021