ISLAMABAD - After failure in collecting Rs445.627 billion Gas Infrastructure Development Cess (GIDC) from the influential industrialists, the government has constituted a committee for the recovery of arrears from the defaulters. A meeting of Senate Standing Committee on Petroleum held under the chairmanship of Senator Abdul Qadir was also informed that despite the reduction of LNG prices to 50 percent in spot market, Pakistan cannot afford to purchase due to financial crises and LCs issues. While briefing the panel, Secretary Petroleum, Mohammad Mahmood, said that the Petroleum Division’s position is that all gas should be used to generate electricity, but they are not being listened as the Industry is very powerful and they gets the decision of their choice. “If natural gas is given to power plants, it will reduce the cost of the electricity by 70 percent,” Secretary Petroleum argued. “This is also the best way in the world, here we are giving gas to domestic consumers,” he added.
Cabinet decides to make NAB chairman more independent as amendments approved
The committee sought details from the Ministry of Petroleum to take forward the proposal. The committee was informed that various government and private entities owes Rs445.627 billion of the GIDC. It was informed that around 20 percent of the country’s total gas is consumed by the fertilizer sector. The chairman of the committee said that instead of benefiting the industrialist, the government should benefit farmers. Secretary Petroleum Mohammad Mahmood said that they are examining whether to make fertilizer with local gas or import it. The fertilizer sector is the biggest defaulter with Rs171 billion dues of GIDC. Fertilizer sector accounts for 20 percent of the country’s total, and receives cheap gas, the chairman committee added. The K-Electric is the defaulter of Rs39 billion on account of GIDC, CNG sector Rs82.13 billion, Pakistan Steel Mills owes Rs2 billion, WAPDA/Gencos Rs4.286 billion, IPPs also have to pay Rs4.343 billion. The textile industry is in default of more than Rs22.757 billion, the general industry is in default of Rs20.288 billion and the captive power industry is Rs78.928 billion. The chairman Committee claimed that gas worth $13/ MMBTU is being provided to fertilizer factories at $2 to $4/ MMBTU.
Prohibited funding case: NAB team fails to present notice to Imran
The secretary petroleum said that he wants more gas to be given to the power sector. “We have some gas, the power sector wants it to be given to them while the fertilizer sector says it should be given to them,” the secretary petroleum added. He said that a committee has been formed under the chairmanship of the finance minister. The attorney general has been called in the next meeting to end the stay orders taken by the GIDC defaulters. Managing Director (MD) Pakistan LNG Limited (PLL), Masood Nabi, while briefing the committee, said, “At present, the prices of LNG in the spot market have reduced; the cost of LNG cargo falls by fifty percent in the international spot market and the price of spot LNG is $14 per MMBTU.” However, he maintained, “Our financial situation does not support buying cargo from the spot market and excitingly we are fulfilling our demand from long term contract only.” At present, there is issue of LCs and if they give tenders for spot LNG purchase, no one will come, he said. While briefing the committee on excess capacity utilisation of LNG terminals, it was told that there are no third party access rules to the LNG terminal at the moment.
Shab-e-Barat to be observed with traditional zeal on Tuesday night
The framework of rules for handing over LNG terminals to third parties has not yet been approved, the secretary petroleum said. “If the rules are approved, then the additional capacity of the LNG terminals will be utilised by the third party,” said the secretary petroleum.