Sunday, January 2, 2011

Country faces 600-900mmcfd gas shortfall

Country faces 600-900mmcfd gas shortfall

ISLAMABAD: The country is currently facing about 600 mmcfd natural gas shortfall and during peak hours the gap between demand and supply reaches 900 mmcfd, told Secretary Ministry of Petroleum and Natural Resources Imtiaz Qazi during a press briefing on Thursday.

“The gap between demand and supply of natural gas is due to provision of gas facilities to new villages, cities, general consumers and commercial connections — which is exerting pressure on the existing supply of gas,” he said.
He said the existing gas fields are also going downwards adding “if the existing demand for natural gas continued, the situation would get a lot worse in the next 5 and 10 years.” However, he explained that the government has several options to meet gas demand –and priority is being given to explore indigenous resources and explore maximum gas faculties across the country. The government has discovered huge resources of gas in Khyber Pakhtunkhwa province, Sindh particularly Zin, Dera Bugti Balochistan.
Although the government still could not touch the Zin Balochistan servers due to security and other reasons “but work would be initiated immediately.”
The government has already signed Turkmanistan, Afghanistan Pakistan and India gas pipeline project worth $7.6 billion. Iran-Pakistan gas pipeline project is also in advance stage. “The government also is positively considering LNG import project that would be put in gas pipeline distribution system — and the last one, which is more important, is the awareness campaign on gas conservation among the gas consumers to optimise its usage,” he said.
The secretary expressed hope that with completion of these options the country would be able to meet the demand and supply of gas. Answering a question, he said LPG is a deregulated commodity, however, “OGRA has the authority to keep a check on its prices and monitor it. The LNG import project is delayed due to litigation but now the ministry of petroleum and natural resources again is again going to the Economic Coordination Committee (ECC) of the cabinet to resolve the issue quickly.”
According to him, the best option for LNG import project is to do it on fast track. Some power producers (IPPs) also consulted the government for its import.
If LNG import project re-tender it would take at least six months. “We legally strong to defend our case and the government going for re-tendering the LNG import project,” he maintained.
About changes in petroleum products, the secretary said it is totally linked with changes in POL prices at international prices. Whenever there was increase at international level, the effect passed on and the government has no role in changing the prices. From petroleum products, the government earned Rs250 billion as revenue and if the gas revenue also included in it then the amount become Rs350 billion. When the POL prices increased in international market and the government could not passed on the effect, then it has to provide subsidy or borrow or print more currency notes to fill the gap. All these measures have negative impact on economy overall, he added.

With the arrival of winter season, he said the POL prices usually have rising trend at international market and same is the case in Pakistan. About expected increase in POL prices for Jan 2011, the secretary it was yet to be finalized but general trend was to increase POL prices.

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