KE, SSGC meeting convened to sort out gas issue

Nepra warns of law and order situation in Karachi if loadshedding persists

ISLAMABAD: The Ministry of Energy (Power Division) has convened an emergency meeting on Friday (today) to resolve a row between K-Electric and the Sui Southern Gas Company (SSGC) over curtailed supply of gas following the intervention of power regulator.

Officials of K-Electric, National Electric Power Regulatory Authority (Nepra) and the Petroleum Division would attend the meeting.
Minister for Power Division Awais Khan Leghari also asked the K-Electric secretary to convene an emergency meeting of the board of directors to find out a permanent solution to the loadshedding issue in Karachi, following a letter sent by the power regulator.

Nepra has warned the federal government the law and order situation in Karachi could go bad in the summer in case prolonged power outages had become a norm and recommended to immediately restore gas supply to power plants of K-Electric (KE).



The power regulator in a letter sent to the Ministry of Energy secretary on April 18 warned that with the onset of the summer and as the month of Ramadan is also approaching, the KE supply-and-demand gap is bound to widen which may lead to law and order situation in Karachi.

The committee formed by Nepra had noted that KE was receiving around 50 to 60 MMCFD less gas as compared to April 2017 and the situation has worsened due to increase in power demand owing to early onset of the summer.

The Nepra team had held detailed discussions with KE professionals, inspected its power generation plants and conducted field surveys of KE consumers.

In addition, the team also presented its findings and identified a number of areas that needed to be addressed to improve the prevailing situation.

The regulator said it had decided to take up a number of matters that were directly linked with KE. However, Nepra had observed that gas was one of the major issues that needed to be resolved on top priority basis.

The regulator recommended the government to immediately restore the gas supply to 190 million cubic feet per day (mmcfd) and maintained at such level till October so that consumers do not suffer during the summer.

The regulator also recommended that the federal government through the Ministry of Energy being 24 per cent stakeholders of KE may convene an emergent meeting of the board of directors (BoD) to resolve the problem on the long-term basis.

It further said that the Ministry of Energy may also convene a meeting of KE and SSGC to work out the methodology for signing of the gas sales agreement (GSA) between KE and SSGC.

“We feel that the present situation cannot be continued for an indefinite period, as even if KE takes all other corrective measures, sufferings of the consumers cannot be fully eliminated. It is also pertinent to mention that with the onset of the summer and Ramadan month approaching, KE’s supply-and-demand gap is bound to widen which may lead to law and order situation in Karachi.

The regulator further said that in economic terms due to constrained supply, KE is pressed to carry out loadshedding in the industry also for which the cost of unserved energy is very high as it directly hurts the economy of the country.

So, it is strongly recommended to restore 190 mmcfd gas supply to KE and convene a meeting of the board of directors to safeguard the interests of consumers on a long-term basis, the regulator said.