The fertiliser sector has offered the government that it will pay cost differential of running power plants on fuels other than gas, provided the government diverts 120 million cubic feet per day (mmcfd) of gas to fertiliser plants, as low availability of gas has not only reduced power generation by 800 megawatts, but is also becoming a reason for urea shortage.
In a bid to work out a viable solution to gas shortages for the fertiliser and power sectors, stakeholders held a meeting with Federal Water and Power Minister Syed Naveed Qamar.
Fertiliser companies asked the government to divert 120mmcfd of gas to the sector and run the four affected power plants on alternative fuels. They offered to pay the price differential to these independent power plants. Currently, the fertiliser sector is receiving around 140 mmcfd less than the requirement.
However, owners of the four power plants raised the issue of non-availability of fuel and late payments, as the plants needed four million litres of fuel per day. The four power projects of over 800 megawatts are not receiving gas as per their allocation. It is for the first time the government has resorted to gas load management in the summer, facing shortages of over 600mmcfd.
Qamar asked both the sectors to find out a workable mechanism for the approval of the government and present it on Saturday. He said that provision of gas to the power sector was the government’s priority, as the country needed maximum power generation in the summer. Nonetheless, the fertiliser sector is also very important to produce fertiliser and meet agricultural requirements.
Qamar asserted that maximum agricultural produce would help boost the economy. Unfortunately, there was shortage of gas and all sectors were facing a drop in gas supply, he added.
Power shortfall
The power shortage on Friday remained at 3,891MW, said an official of the Pakistan Electric Power Company. Total generation was recorded at 12,229MW against a demand of 16,120MW.
Against a 6,565MW capacity, hydel generation remained at 4,005MW. Against a 4,900MW capacity, thermal generation was recorded at a mere 1,745MW owing to fuel shortages, which have resulted in up to 14 hours of outages, particularly in rural areas. Additionally, generation by independent power producers stood at 6,417MW.
Published in The Express Tribune, April 30th, 2011.
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