The citizens – already facing over 10 hours of power load shedding – are set to suffer for even more hours without electricity as the Sui Southern Gas Company (SSGC) on Thursday announced it was curtailing at least 60mmcfd gas from its 180mmcfd gas supply to the Karachi Electric Supply Company (KESC) over non-payment of Rs 28.7 billion outstanding dues.
Speaking at a press conference at the SSGC Head Office, SSGC Deputy Managing Director Zuhair Siddiqui said the fresh curtailment in supply was being made only because of the payment issue, as SSGC could no longer afford to supply the gas without getting paid for it. “The KESC has stopped releasing its monthly bills for gas since May, taking the outstanding amount to at least Rs 28.7 billion that includes over Rs 2 billion for the gas bill of the current month.”
“Due to the non-payment of charges from KESC, the gas utility is unable to make payments to the exploration and production (E&P) companies and disbursement of salaries to its employees. Ultimately the gas company, as a last resort, had to reduce the supply to the privately-run power utility.”
“The SSGC was forced to take this step because its total outstanding dues with KESC have swelled to over Rs 28 billion. Last month, the KESC paid 50 percent of its current bill, but this month it has not made any further payments to the SSGC, although the due date was July 20. “The position has been further compounded by the fact that the Oil and Gas Development Company Limited (OGDCL) owes a further Rs 24 billion to the SSGC,” said Siddiqui.
Responding to allegations of terminating gas supply to the KESC, the SSGC Deputy Managing Director dispelled the impression being created in a section of the media. “The SSGC has only reduced the supply to KESC by 60mmcfd due to the power company’s incapacity to settle its dues,” he said. Siddiqui said there was no Gas Sale Agreement (GSA) with KESC and the power company’s claims of increasing load shedding only because of limited gas supply is baseless as the maximum gas requirement of the company is at least 120mmcfd while the other power generating units should be run on furnace oil.
Despite repeated issuance of notices to the KESC, it was not only dishonouring various payment agreements and understandings, but also making baseless claims regarding gas agreements with SSGC. In a late night development, on the directive of Federal Petroleum and Natural Resources Minister Senator Dr Asim Hussain, the SSGC took back its decision and resumed the supply to KESC for the time being in an effort to save the citizens from further suffering.
