Country fast losing natural gas reserves, says Omar Ayub

Published October 29, 2020
FEDERAL Energy Minister Omar Ayub Khan speaks to the business community in Hyderabad circuit house on Wednesday. — APP
FEDERAL Energy Minister Omar Ayub Khan speaks to the business community in Hyderabad circuit house on Wednesday. — APP

HYDERABAD: Federal Energy Minister Omar Ayub has said that Pakistan is fast losing its reserves of natural gas in Sindh, Balochistan and Khyber Pakhtunkhwa and it is time to take a decision on the weighted average cost of gas.

He said that the Sindh government was still undecided about it despite the fact that the province was losing seven per cent of its conventional gas reserves.

The minister was speaking at a press conference here on Wednesday after meeting with lawmakers of the Muttahida Qaumi Movement-Pakistan (MQM-P), office-bearers and workers of his own Pakistan Tehreek-i-Insaf (PTI) party and officials of the Hyderabad Electric Supply Company (Hesco).

MQM-P MNA Sabir Kaimkhani, MPA Rashid Khilji, PTI’s MPAs from Karachi Haleem Adil Shaikh and Khurram Sher Zaman were also present.

He said that the government inherited a crisis from the governments of the Pakistan Peoples Party (PPP) and Pakistan Muslim League-Nawaz (PML-N), whose unprofessional decisions destroyed the Pakistan Steel Mills, gas utilities, power distribution companies etc.

He said when the PPP completed its term it left two months of foreign exchange reserves. He said that former president Asif Zardari-led regime had left a debt of Rs7 trillion and the PML-N government had increased it to Rs30 trillion when it completed its term in 2018.

He said the PML-N had left only two weeks of foreign exchange reserves and the current account deficit at $20 billion. “Today, it is showing a positive trend.”

He claimed that the past government artificially controlled the rupee and pumped $24bn to maintain the exchange rate against US dollar.

20 new blocks for gas exploration

Mr Ayub said that the issue of gas was taken up in the Council of Common Interests (CCI), where the Sindh government claimed that it had sufficient reserves. “In fact, Sindh will be having a deficit in its reserves this year,” he said.

He said both the PPP and PML-N governments didn’t go for drilling of new blocks but the PTI government had auctioned 20 blocks. “Its impacts will be seen after five years,” he said.

The federal minister said the current gas shortage could be met through the liquefied natural gas (LNG) on a short-term basis. He added that two LNG terminals would be established in collaboration with the Russian government through laying of north and south pipelines to overcome the shortage to some extent.

“Shortage [of gas] will end only with the discovery of new reserves,” he said.

He said the weighted average cost of gas should be determined for local gas and LNG.

“If cost is determined we will be out of the shortage issue,” he claimed. He said one should ask why the PPP and PML-N governments did not work to discover new reserves of gas and it was the ruling PTI which was doing it now.

“Past governments were opting for drilling in same blocks, which was technically not feasible. Sindh’s reserves have declined by 7pc,” he said.

He said Pakistan’s unconstrained gas demand was 7.5bn cubic-ft compared to the domestic production of 3.5bn cubic-ft.

He said 1.2bn cubic-ft was met with LNG while the remaining gap resulted in gas shortage. This could be met through imported gas, he said. “Discovery of new reserves will take five years. We expect we will get some to meet this shortage,” he said.

He said gas shortage was discussed in CCI and it was informed that reserves in Sindh would start declining this year while Balochistan and Khyber Pakhtunkhwa would start losing it in four to five years.

“We must take a decision on the weighted average cost of gas but Sindh government is taking it too long to arrive at a decision,” he said.

‘Wrong deals’

He said both the PPP and PML-N governments had signed wrong deals. “These governments had dropped the options of solar, wind and hydel power generation and preferred imported energy. Around 70pc of energy is being produced through imported fuel causing expensive electricity,” he said.

Mr Ayub said that the PTI had signed a deal for solar energy at the rate of Rs6.50, or 3.75 cent, per unit whereas the PPP and PML-N signed similar deals for Rs18 and Rs24 per unit, respectively.

He disagreed with a questioner that Sindh’s gas rights were being snatched.

He said the Tarbela dam, which is located in his hometown Haripur, produced electricity and it transmitted into the national pool for its onward distribution.

The PTI leader said electricity produced in Thar coal or wind energy in Jhimpir would go to the national pool to benefit entire Pakistan including Sindh.

He said that the Pakistan Democratic Movement (PDM) might hold public meetings but any act of “treason” that was reflected from the speeches of the alliance’s leaders would not be tolerated.

He said the PTI, its allies and people would hold PDM accountable. “PDM is there to cover up its theft, damage to Pakistan’s interest and act of serving its own interests,” he alleged.

He said people needed change and that was why they were supporting the PTI.

PPP blamed for Hyderabad woes

The federal minister said Hyderabad faced urban flooding due to incompetence of the Water and Sanitation Agency (Wasa), which was controlled by the PPP’s government in Sindh.

Areas in rest of Sindh other than Karachi reflected a sorry state of affairs. Such cities and towns were in a better shape 50 years back, he said.

He said the Hesco management would submit recommendations for installations of more grid stations, independent feeders, new transformers and four workshops, which would all be funded by the federal government so that power supply was improved in the region.

He said he had restrained Hesco from disconnecting supply to entire area over a few defaulters’ fault.

Mr Ayub said action against water theft would continue and business leaders would give their input in this regard as well.

Published in Dawn, October 29th, 2020

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