Khan, speaking at the Lahore Chamber of Commerce and Industries meeting, stressed the need to divert natural gas from CNG to the industrial and power generation sectors. “Pakistan has ample reserves to fulfill the country’s requirement for fifty years,” said Khan. “The right policy framework and strengthening of institutions will help increase gas production.”
He further said high prices of petroleum are mainly due to various taxes and levies imposed by the government.
“The mechanism to set the petroleum price has already been laid down by the government; Ogra only implements those orders in setting up prices.”
Meanwhile, LCCI Acting President Mian Tariq Misbah said the price of petroleum products should be tied to their respective dollar prices and the exchange rate. “Despite the recent appreciation of rupee against the dollar (by about 10%) and decline in crude oil price in the international market, there was no corresponding decrease in petrol and diesel prices in the country.”
He added that petrol and petroleum products in Pakistan are substandard and there is a lot of adulteration, stressing that the products are tested all over the world to ensure compliance with international standards. Misbah said the regulator needed to ensure stringent testing of all petroleum products sold in the market in order to stop the contamination and wastage of money and natural resources.
“There should be strict monitoring of Sui Northern Gas Pipelines Limited (SNGPL) and concrete steps should be taken to control UFG (Unaccounted for Gas) and unnecessary expenses. The UFG of SNGPL currently stands at around 4.5%. Due to inefficiencies, it often faces revenue shortfalls which are covered by increasing the gas tariff,” he informed.
Ogra has already announced a rise in gas tariff by 14% for SNGPL, an increase of Rs.58.20 mmbtu.
“There is currently a ban on refueling public transport vehicles with LPG, but the same ban is not extended to CNG. This ban should be removed and establishment of LPG auto stations in the country should be permitted. Doing so will reduce the consumption of CNG, and more natural gas will be available for important sectors,” Misbah said.
He said many unauthorised manufacturers of LPG cylinders have started marketing sub-standard cylinders at cheaper prices to distributors. Misbah lamented that Ogra has not initiated action against these illegal manufacturers who present a great risk of accidents and damage to public life and property.
Published in The Express Tribune, August 26th, 2014.
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