KARACHI, Nov 5: Sui Southern Gas Company Limited (SSGC) is finalizing a “gas tariff rationalization plan,” under a market base structure to facilitate and help the poor domestic consumers.
Newly appointed managing director of SSGC, Munawwar Baseer Ahmed informed a press conference at the SSGC head office on Tuesday that this tariff rationalization was being done on the government instructions.
“The main aim of tariff restructuring is to support the poor consumers as the current tariff structure lacks any balance,” he said.
He said 78 per cent of all domestic consumers fell under lifeline rates of 68 paisa mcf, out of four slabs of tariff. “SSGC is collecting customer data these days to help out the government in rationalizing the tariff structure,” he added. He did not give the exact date as to when the new plan will come into force.
On SSGC privatization, he said the government and the Asian Development Bank had appointed PriceWaterhouseCoopers as its consultant to evaluate and determine the restructuring of the transmission and distribution sector of the gas industry. The consultant has submitted its report and the government is studying it. The government holds 70.43 per cent of share in SSGC followed by 13.66 per cent by the financial institutions, 8.70 per cent by insurance companies, 4.30 per cent by individuals and 2.31 per cent by joint stock companies and others.
The company intends to sell more gas up to 300 mmcfd to Wapda and KESC’s Bin Qasim power plants by March 2003, from the existing 200 mmcfd of gas which will help in reducing the import bill of furnace oil, he said.
On future development plans, he said the company had undertaken gas infrastructure rehabilitation and expansion project under which the SSGC’s gas transmission and distribution capacity would increase by about 50 per cent by mid-2003. Some of the projects include Bhit Bajara Pipeline and SSGC is looking forward to receive gas supply from its operators in January, 2003. Supply of gas from Bhit is estimated at 270 mmcfd. The project of augmentation of North Karachi (ACPL) and Bin Qasim Spur Line has been completed. Sawan Gas Field integration, operated by OMV, is targeted by March 2003 and gas supply is expected from July 2003. SSGC will receive 170 mmcfd of gas in its distribution system from Sawan. The compressors relocation to Hyderabad will be completed by June.
Giving a breakup on country’s gas demand, he said total gas demand would surge to 3.7 billion cubic per day by 2005 from 2.7 bcfd in 2000, rising to 4.2 bcfd by 2010 and to 4.6 bcfd by 2015. He added that power sectors consume bulk of gas supplies out of total gas demand. The demand for gas projections for power sector is 1.8 bcfd for 2005, rising to 2.0 bcfd by 2010 and to 2.2 bcfd by 2015.
If a demand and supply gap is taken, he said, the gas demand in 2005 would reach to 3.7 bcfd from 2.7 bcfd in 2000, but there would be a gap of 0.6 bcfd as supply will be 3.1 bcfd by 2005.
He said Pakistan’s estimated life of gas reserves at current production level was 25 years. Current gas reserves stand at 22.7 trillion cubic feet and the production is 0.900 trillion cubic feet a year.
Senior general manager, commercial, M.H. Asif said the company was introducing hand held computer metre reading system from next week thus replacing manual data, entry, verification, checking and correction process.
SSGC’s profit before tax in 2001-02 rose to Rs2,154 million as compared to Rs1,975 million, up by nine per cent. The company’s gas sales volume increased from 206,967 mmcfd to 234,553 mmcfd, showing a rise of 13 per cent and gas sales value increased from Rs25.4 billion to Rs32.2 billion. The number of consumers increased from 1,569,380 to 1,611,973. SSGC’s staff strength is 5,107.