SSGC allowed to lay gas pipeline

Company will complete 17km pipeline in two to three months at cost of Rs2 billion

The years-long pending issue between the federal and Sindh governments has finally been resolved as Sui Southern Gas Company (SSGC) has been asked to lay a 17km pipeline for gas import to overcome prolonged gas and power blackouts in Karachi, upper Sindh and Balochistan.

“SSGC aims to complete the project in two to three months at an estimated cost of Rs2 billion,” an SSGC spokesperson told The Express Tribune on Tuesday. “The pipeline of 30-inch diameter will be capable of transporting 600 mmcfd (million cubic feet of gas per day),” he said.

A letter from the Sindh Energy Department to the Malir district deputy commissioner read: “Deputy commissioner Malir is directed to allow SSGC to carry out physical laying of the pipeline and ensure that SSGC team or contractor is not stopped or hindered in any manner from carrying out this construction of pipeline.” Sindh Minister for Energy Imtiaz Shaikh said in a statement that the Sindh government had allowed SSGC to lay the pipeline on October 8 through a letter dispatched to the Malir district deputy commissioner and SSGC.

He said it was in response to Federal Minister for Power Omar Ayub Khan’s tweet on Monday, reading: “The Sindh government has still not given the Right of Way permission for a 17km SSGC pipeline despite repeated letters, meetings with officials over a period of 1.5 years. Sindh government will be directly responsible for any gas shortages in Karachi.”

The pipeline from Port Qasim to SMS Pakland would allow SSGC to induct its own imported gas - re-gasified liquefied natural gas (RLNG) - into the system to overcome gas outages mainly during winter and power blackouts in summer.

Federal and provincial governments are focusing on increasing import of gas to tackle shortages following the drop in domestic production to a record low after some of the fields became redundant while several other fields slowed down production.

Oil and gas exploration firms, working in Pakistan, have not found meaningful deposits of hydrocarbons for over a decade now.

The country produced 3,323 mmcfd of gas in the week ended October 6 against estimated demand for around 7,000 mmcfd.

The Sindh government has reported that the province alone produces 2,200 mmcfd. However, it is being supplied only 900-1,000 mmcfd against total requirement of 1,600-1,700 mmcfd in the province.

Therefore, Sindh is facing a shortfall of 600-700 mmcfd that may further widen in winter.

Imtiaz Shaikh added in the statement that Sindh was being forced to use expensive imported gas despite production of more gas than total requirement of the province.

“The 1973 Constitution, not the 18th Amendment, gives right to the Sindh province to use the locally produced gas first. However, we are denied the constitutional right and being forced to use expensive RLNG,” the minister was quoted as saying by one of his aides. He added that the Sindh government was supposed to provide land to SSGC for laying gas pipeline over only 4 km out of the total 17 km as the rest of the land covering 13km of the pipeline was within the jurisdiction of Port Qasim and Steel Town, which was owned by the federal government.

A source, however, said SSGC was laying a 32-inch diametre pipeline, which was used to transport locally produced gas, while it needed to build a 42-inch diametre pipeline to carry imported gas.

He said SSGC was supposed to complete the project in two months or before the arrival of harsh winter, especially in Balochistan, which faced extremely cold weather.

Citing reasons for the delay in permission, the letter added that it was decided in March that SSGC would furnish an undertaking for payment of all costs determined by the government of Sindh and the Energy Department would direct the deputy commissioner concerned to allow/ not hamper on ground work of laying the said pipeline since SSGC was a state-owned company and the work was in public interest.

Meanwhile, the land acquisition process and compensation will be completed by the Board of Revenue.

“With reference to today’s (October 8) high-level meeting (attended by Omar Ayub and other federal govt officials) and undertaking of Amin Rajput, (SSGC) Acting Managing Director, for payment of all dues of government of Sindh…and telephonic approval from Minister of Energy, Sindh Imtiaz Shaikh, deputy commissioner Malir is directed to allow SSGC to carry out physical laying of the said pipeline.”

Published in The Express Tribune, October 21^st, 2020.

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