A heated debate took place between the parliamentarians and officials of the petroleum ministry on Tuesday, with politicians demanding supply of natural gas to their constituencies while officials vehemently opposing the demand saying that it is not economical, considering the historic gas shortage and poor rate of return on investment in rural areas. Chairman of the National Assembly Standing Committee on Petroleum Sardar Talib Hassan Nakai at the outset expressed complete dissatisfaction over the government’s efforts in managing the gas crisis. He said the government’s load management plan miserably failed, as were its measures to expedite domestic oil and gas exploration. It failed to make any progress on LNG and LPG imports and committee was not taken into confidence on Iran Pakistan and TAPI gas pipeline projects.
Secretary Petroleum Ejaz Chaudhary that the gas utility companies incurred an expenditure of Rs250 billion during the last four years to expand the gas infrastructure to less profitable rural areas, as the gas sale volume only increased by 1.7 per cent during the period. He said the increase in gas prices was necessitated due to the guarantee of 17 per cent return to gas utility companies on their infrastructure even though no increase in gas price was allowed to the producers.
Criticizing his argument, Dr Donya Aziz of PML-Q said it was the basic responsibility of the government to provide affordable energy to the people. She said the people in rural areas were paying all their tax on agriculture inputs and they should not be sidelined in development.
MD of SNGPL Arif Hameed said the company was laying on the average 5,000 km of pipeline every year for connecting new villages and towns. He said already 13,000 km pipeline expansion projects were pending due to lack of funds, which will require at least three years to complete. He said the government was providing only 25 per cent of the cost for the parliamentarian schemes while the rest was being borne by the company itself by getting it financed at 14 per cent interest rate from banks. Countering the Secretary Petroleum statement he said in fact they were losing money instead of making profit from new supply schemes.
SNGPL, he said was working on Rs16 billion worth of projects while Rs18 billion were required for parliamentarians schemes. While another Rs35 billion were required to develop new infrastructure for the transmission of LNG and other import projects. He said the domestic banking sector was not in a position to finance Rs50 billion worth of projects of the company.
Members criticized that the concerned officials totally failed to foresaw the gas shortages and did not bother to plan to avert the crisis, Secretary Petroleum said that the ministry was warning since 2004 of imminent gas crisis if local oil and gas exploration was not expedited and expansion in gas infrastructure was not stopped, which ultimately resulted in a ban on new CNG station in 2008.
When Barjees Tahir of PML-N asked him to fix responsibility on officials who granted illegal licenses during the ban, he said top OGRA officials were involved and the committee was already investigating the issue. However, he accepted that he was totally handicapped in implementing the gas load management plan due to the pressure of the various stakeholders.
