January 10, 2007	Wednesday	Zilhaj 19, 1427

LAHORE, Jan 9: The Sui Northern Gas Pipeline Limited (SNGPL) faces a deficit of 700 million cubic feet per day (mmcfd) as temperature dips down to below zero Celsius, and is meeting the shortfall by suspending supplies to some 300 industrial units in the Punjab and NWFP.

According to official sources, the company was saving around 450 mmcfd through suspension of supplies to these industrial units, which include 11 cement units, two fertiliser factories and captive power producers.

It also has a demand of 300 mmcfd from Water and Power Development Authority (Wapda) and is refusing to oblige in winter. Though Wapda gets these supplies during summer when the company has sufficient supplies.

According to the officials of the company, there may not be any need to suspend supplies to more units as temperature has stabilised, albeit at very low level. On Tuesday, the total gas supply in both provinces was around 1,800 mmcfd whereas the demand was 2,250 mmcfd. It met the demand by cutting down supplies to industry in both provinces.

The demand is multiplying every year, they said and added: "The pace can be gauged from the fact that the company faced a deficit of 400 mmcfd last year, which has gone up to 700 mmcfd this year. The situation could be worsen next year when four more gas-driven power units - Safire, Saif, Orient and Savari - would come online, producing around 1,000mw of electricity and requiring 220 mmcfd gas.

This demand would on top of the usual 12 per cent load growth, which would add a load of another 200 mmcfd. Thus the total deficit may hit 1,100 mmcfd. During next 12 months, the only addition would 50 mmcfd from third well of Ghurgri Gas Field in NWFP.

In the next two years, if no new gas fields are discovered or gas imports resumed, there is very possibility of load-shedding even during the summer. All of it would be happening at the cost of industry because it would be disastrous to shut off supplies to domestic consumers, they said.

Reacting to the fast emerging crisis, an industrialist from Lahore said that it could be down right disaster for the industry. With globalisation taking effect, no industry could survive on nine-month gas supplies, as foreign importers won’t be ready to wait for three months every year for goods supplies.

"No one knows what kind of planning the government is doing. For the last six years, the government is negotiating gas tariff with Iran but nothing happened so far. Given the compulsions of international politics and US pressure on Pakistan to avoid dealing with Iran, there is little likelihood of deal getting through.

On the other hand, any delay in deal would literally spell disaster for the industry. The three months hiatus of gas supplies costs the country and industry billions of rupees and the cost would only increase in the coming years. The industry is caught between the US interests and a very hard place, and it could be saved by quick and necessary decisions by the government.