LPG sector demands swift restart of JJVL plant

Argues plant closure has dented LPG output, sent prices soaring

ISLAMABAD:

Stakeholders from the liquefied petroleum gas (LPG) sector have urged the newly elected prime minister to resume operations of Jamshoro Joint Venture Limited (JJVL) LPG plant in order to meet the domestic gas demand.

In a letter to Prime Minister Shehbaz Sharif, LPG Industries Association Chairman Irfan Khokhar demanded the prompt restoration of JJVL plant operations.

He argued that the closure of JJVL - Asia’s largest LPG processing plant - had significantly reduced LPG production and pushed up “gas prices by 172% in just two years”.

Also driven by the rise in international prices, the LPG rates in Pakistan surged to Rs247 per kg as compared to Rs90 per kg around two years ago, he said. He claimed that the closure of JJVL plant from June 21, 2020 to March 31, 2022 caused a loss of around Rs50 billion to the national exchequer.

“This damage to Pakistan’s LPG industry and the national exchequer has mainly been done by the incompetent management of a utility firm,” he lamented. Despite instructions from the Ministry of Energy (Petroleum Division) on October 1 and November 9, 2021, “gas supply has not yet been resumed to JJVL for LPG production”, he underlined.

Lauding the prime minister’s efforts, Khokhar voiced hope that the newly formed government would continue to work towards progress of the country.

“JJVL can contribute to the industry by producing 10,000 to 12,000 tons of LPG per month, catering to the demand from 750,000 houses while providing employment opportunities to more than 5,000 people.”

The plant was built with an investment of Rs40 billion (50% foreign investment), he recalled, adding that its closure was discouraging foreign investors besides hurting the gross domestic product (GDP) of Pakistan. “JJVL has not been operational since July 21, 2020,” Khokhar said, adding that poor people of Pakistan were suffering due to its closure by bearing an extra burden of LPG imports.

“We request you to restore operations of JJVL on an urgent basis, so that it can play its role in maintaining the supply chain by reducing gas shortages in the country,” he said. With the restoration, the national exchequer would also get the benefit of billions of rupees annually, he added.

Published in The Express Tribune, April 15^th, 2022.

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