ISLAMABAD: Petroleum Minister Shahid Khaqan Abbasi said on Thursday that efforts were being made to shift the burden of proposed gas price increase from domestic to other categories of consumers, but insisted that the hike was inevitable.

Speaking to journalists after a meeting of the Senate standing committee on petroleum, he said the prime minister had not rejected the petroleum ministry’s summary for gas tariff hike as such, but the burden of domestic consumers needed to be passed on to other consumers through cross subsidisation.

He said the review of gas price involved revenue requirement of gas companies which had to be met through an increase in prices. The government did not have the resources to provide subsidy from the budget and, therefore, the tariff would have to be increased, the minister added.

In reply to a question, Mr Abbasi said the import of liquefied natural gas (LNG) early next year would help the country save Rs30 to Rs80 billion per annum. Besides Qatar, the government is also holding talks with Malaysia for LNG import.

He declined to directly answer a question about the possible price of LNG and only said the market price ranged between $10 and $22 per barrel, expressing the hope that a long-term agreement would ensure cheaper price.

PSO PROBE: Earlier the standing committee, chaired by Senator Mohammad Yousaf, directed the petroleum ministry to take measures and request the interior ministry to look into the FIA investigation against senior officers of the Pakistan State Oil.

The committee asked the Federal Investigation Agency to come up with evidence against the PSO officers, including its acting managing director.

The FIA’s additional director Shuja Naveed informed the committee that the agency had requested the interior ministry to remove the PSO’s acting managing director and placed the names of nine senior managers on the exit control list.

Amjad Janjua, the acting managing director, told the committee that he and the company were unaware of any such investigation.

The FIA initiated the investigation against Amjad Janjua on Sept 24 last year — only two months after he assumed the charge.

The committee members asked the FIA what serious issues cropped up in just six to seven weeks which led it to start the investigation. They also expressed resentment over non-preparation by the FIA additional director and the item on the agenda was withdrawn till next meeting of the committee.

The senators expressed concern over the damage caused by delay in un-boarding shipment from a ship tanker.

The committee was informed that the shipment did not fulfil the required specifications of oil. It contained high viscosity and sulphur content.

Amjad Janjua said the matter was in court which would decide who was liable to pay the damages — whether the PSO which had ordered the product or the Pakistan National Shipping Corporation which brought the product. He said the shipment had left Malaysia with correct specifications, but reached the Karachi Port with wrong specifications.

The committee asked the PSO to clarify the matter in its contract so that such dispute could be averted in future.

The committee was informed that PSO receivables had exceeded Rs200 billion because of non-payment by a number of companies. The committee decided to summon the defaulters at the next meeting.

The Minister for Petroleum and Natural Resources, Khaqan Abbasi, informed the senators that the prices of petroleum products should be further reduced in view of a decline in their rates in the international market. He said the prices were determined by the Oil and Gas Regulatory Authority.

The committee decided to call the Ogra chairman at the next meeting.

Mr Abbasi also said that since the FIA had become part of an investigation into gas theft, no significant achievements had been made.

He said the government held 75 per cent shares in Oil and Gas Development Company Limited and was selling only 10pc shares. “This will give us a profit of $600-700 million,” he said.

Published in Dawn, November 7th, 2014