Khaqan Abbasi presents himself for trial if corruption unearthed

Says Sindh’s allegations are only meant to make political gains

ISLAMABAD:

Petroleum and Natural Resources Minister Shahid Khaqan Abbasi has offered himself for trial for any irregularities in the award of a liquefied natural gas (LNG) terminal contract and subsequent gas imports.

“If anyone needs record for investigation, I am available to take responsibility,” Abbasi said at a press conference here on Monday.

He was responding to allegations of corruption in LNG projects levelled by Sindh Finance Minister Syed Murad Ali Shah on Sunday.

“There may be procedural lapses, but there is not a single sign of corruption in this government,” he said, pointing out that the LNG terminal contract was awarded after inviting bids from investors.

He said the terminal’s tolling fee was $0.66 per million British thermal units (mmbtu) for 15 years and recalled that the Pakistan Peoples Party (PPP) government had attempted four times to implement the LNG project with a tolling fee of $1 per mmbtu for an integrated LNG supply contract.

Calling the Sindh finance minister’s remarks an attempt to gain political ground, Abbasi said gas issues had been discussed and settled with the province.

Over the years, gas production in the country has dropped 550 million cubic feet per day (mmcfd), which constitutes 20% of the output.

Earlier, Sui Northern Gas Pipelines (SNGPL) was drawing 1,700 mmcfd and Sui Southern Gas Company (SSGC) was receiving 1,200 mmcfd when production stood at 2,900 mmcfd, but now SNGPL is getting 1,150 mmcfd and SSGC is receiving 1,250 mmcfd, though output has dropped to 2,400 mmcfd.

This, according to Abbasi, shows that Sindh’s share has increased to 1,250 mmcfd whereas the impact of fall in gas production has been felt by SNGPL, which has affected the Punjab province.

The winter season would be very harsh for Punjab consumers as only domestic consumers would receive gas, he said, adding CNG stations would be running if LNG was available.



According to him, gas utilities are in swap arrangement, according to which LNG is being consumed in Karachi and against this SNGPL is utilising locally produced gas.

Thar coal

Responding to the Sindh’s demand to take the matter of LNG imports to the Council of Common Interests (CCI), Abbasi clarified that like oil imported gas did not fall within the purview of the CCI.

He said Thar coal came under the domain of the Sindh government and everyone knew what they had done since 2008. Now, he added, this project was being implemented as part of the China-Pakistan Economic Corridor (CPEC).

“LNG, Thar coal, imported coal, IP (Iran-Pakistan) and Tapi pipelines will meet energy needs; Thar coal is very important but it cannot satisfy the entire demand.”

Apart from these, work on the LNG Gwadar pipeline is also under way. A Chinese company will contribute 85% of the financing whereas the Pakistan government will provide 15% of the cost and will have its ownership. The pipeline will be completed in 2017 and carry 1.5 billion cubic feet of gas per day.

Shale gas

Talking about shale gas, the minister claimed that analysis showed that Pakistan had more reserves than estimates of the US Energy Information Administration. In this regard, a final study will be completed in December.

However, he clarified that at current oil prices, shale gas drilling was not feasible as the government would have to offer $12 per mmbtu to energy companies to tap the resource.

Gas theft

Abbasi announced that the Ministry of Petroleum would again present the anti-gas theft bill with some changes in the upcoming National Assembly session for approval.

The ministry has also sent a summary to the CCI for regulating liquefied petroleum gas (LPG) prices in order to provide relief to the consumers. According to the plan, the government will fix margins of marketing companies and distributors. Abbasi termed the increase of Rs6 per kg in LPG price unjustified.

Regarding renewable energy sources, he said the government had earlier imposed a ban on new wind and solar projects, but the prime minister reversed the decision.

Published in The Express Tribune, September 15^th,  2015.

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