KARACHI, Feb 4: The Sui Southern Gas Company has issued notice to the KESC to clear outstanding dues of Rs2.5 billion in two weeks, otherwise gas supplies to its power plant will be suspended, that could lead to massive loadshedding.
The Karachi Electric Supply Corporation, which bought gas for its Bin Qasim power generation plant, had given a cheque for Rs2.1 billion to the gas company for gas supplies till October and the SSGCL had not received any amount till now, the managing director of the SSGCL, Munawwar Baseer Ahmed, said at a meeting with the Karachi Chamber of Commerce and Industry on Tuesday.
“We have informed the finance ministry that if the KESC fails to give the Rs2.5 billion, we will stop gas supplies to the power utility,” he said. Suspension of gas supplies could lead to massive loadshedding in Karachi.
He said he talked to the KESC managing director on Monday who gave an assurance to clear the dues in two weeks. The KESC, he added, was in the process of arranging the payment and a consortium of banks was expected to arrange Rs six billion for the KESC, so that it could pay the dues.
“Only the KESC is creating problems for the SSGC, while Wapda and other power plants have regularized their payment schedules. According to Public Accounts Committee, the SSGC had to recover Rs3.2 billion from Wapda and KESC for gas supplies last year.
“We supply gas to the KESC at the rate of Rs1.90 a kilowatt as compared with the cost of fuel oil at Rs three a kilowatt,” he said, adding the power generation cost of the KESC had declined, showing a difference of Rs200 million if compared with power generation with furnace oil.
Despite these problems, the company had decided to increase gas supplies to the KESC to 240mmcfd from March as compared with the current level of 140mmcfd, he added.
The industrial sector consumes more than 70 per cent out of the total annual gas sales of the SSGC to various customers, including both commercial and domestic. The SSGC has 1,611,973 customers in Sindh and Balochistan covering more than 640 villages and towns.
Referring to gas theft, Mr Ahmed said now there was a line loss of 7.5 per cent. The company was seeking industrialists’ help to curtail the line losses to six per cent this year. The company lost Rs250 million if the line loss was one per cent.
On tariff rationalization plan, he said it would be introduced next year and schools and hospitals would be also included in that.
Earlier, a former president of the KCCI, Zubair Motiwala, pointed out discrimination over gas billing on heating value. He said consumers in Sindh were paying their monthly gas bills at 1,080 BTU heating value, but consumers in Punjab were paying their bills on 880 BTU. “The government has set a national average value of 950 BTU, so why this injustice,” he added.
KCCI President Shaukat Iqbal said industrialists were facing problems because of inordinate delay in conducting survey by SSGC officials for supply of gas to captive power generation units despite having completed all formalities of paper work.
Both the KCCI and the SSGC chief agreed to form a SSGC-KCCI joint coordination committee that would meet once in a month to solve problems relating to the SSGC.
