KESC received 25 per cent less gas in comparison to last year as a result of which its use of furnace oil escalated by 200,000 tonnes. The tariff has risen because furnace oil is double the price of gas. The price at which gas is supplied to KESC is six times the price for fertiliser plants. But the supply has shrunk to 70 mmcfd, 75 per cent less than KESC’s need.
KESC is buying oil for Rs130 million daily. It is a problem that power in Karachi is not produced from water and we do not have any production sources except for the Kanupp power plant.
KESC has approached some international companies and in the next two years will import 200 mmcfd of LNG to reduce its reliance on oil. “We plan to convert two Bin Qasim plant units to coal,” said the letter. “Both of these plants will require huge amounts of money.”
The biggest power plant (560MW) is being completed and will start production from next year but unfortunately a gas supply to this plant cannot be assured. Gauhar said that KESC wanted to strike an agreement with Sui Southern Gas Company (SSGC) based on the success of deals with Wapda and PSO. But if the agreement does not mention gas volume or the limit of supply then it fails to benefit consumers. This is why we have so far not been able to enter into an agreement with SSGC, he said.
Senate committee
Meanwhile, in Islamabad, the Senate subcommittee on privatization has directed the Privatisation Commission (PC) to submit an audit report by the Auditor General on KESC’s selloff.
The committee met on Monday and decided to invite the ministry of water and power and the National Electric Power Regulatory Authority to the upcoming meeting to explain the concessions given to the buyer and to report the evaluation of the benchmark and performance criteria set for KESC.
with additional input from APP
Published in The Express Tribune, November 2nd, 2010.
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