ISLAMABAD: The government is planning to revive and allocate gas from dormant fields to the struggling fertiliser industry as a sharp decrease in gas supply to urea manufacturing plants has brought production to a halt in some cases.
The plan came up for discussion in a meeting, chaired by Prime Minister Raja Pervez Ashraf at the Prime Minister’s House on Wednesday, which reviewed overall gas situation in the country, sources said.
Under the programme, 100 million cubic feet of gas per day (mmcfd) may be provided from abandoned fields of the Oil and Gas Development Company (OGDC) to the fertiliser plants, which are linked with the network of Sui Northern Gas Pipelines Limited (SNGPL) and are currently closed due to shortage of gas.
In this connection, the Ministry of Petroleum and Natural Resources will send a summary to the Economic Coordination Committee (ECC) of the cabinet. This will pave the way for allocation of gas from the dormant fields to the fertiliser industry.
However, according to a participant of the meeting, the Ministry of Water and Power opposed the proposal and asked the government to provide gas from such fields to the power companies, which were operating on expensive furnace oil.
Consequently, a committee, headed by Finance Minister Abdul Hafeez Shaikh, was constituted to resolve the friction over gas allocation. Its members will be Information and Broadcasting Minister Qamar Zaman Kaira and Adviser to Prime Minister on Petroleum Dr Asim Hussain. The private sector will be represented by relevant stakeholders.
According to the sources, President Asif Ali Zardari, in a high-level meeting chaired by him a few days ago, had given assurances that the issue of gas supply to the fertiliser plants would be resolved after his return from Saudi Arabia, where he was attending a meeting of the Organisation of Islamic Cooperation (OIC) countries.
Earlier, gas from the dormant fields was allocated to the Sindh government, but it could not develop the fields. Industry sources said the fertiliser manufacturers were ready to invest in development of the dormant fields to ensure desperately needed gas supply to them.
According to a statement issued after the meeting, the participants of the deliberations cautioned that the country would face gas shortage in coming winter because of increased consumption by residences, depletion of resources and no addition of gas from existing and new sources.
They discussed various proposals to minimise the impact of gas shortage during winters.
The prime minister was of the view that the country would have to make adjustment in consumption in view of the shortage during winter months between November and February because certain sectors would have to be prioritised in view of national compulsions.
Ashraf directed the committee to hold meetings and prepare practical proposals, which should ensure that the gas shortage had a minimum impact on the economy and industry. “Come up with proposals within a week, so that we can grapple with the situation well in time,” he said.
Published in The Express Tribune, August 16th, 2012.
More in BusinessMarket watch: Bourse nears 15,000-point mark