Ministry expresses inability to supply gas for power plants

Islamabad: The Ministry of Petroleum and Natural Resources has expressed inability to supply gas to Wapda's thermal power plants on sustainable basis which are being operated on Sui Northern Gas Pipeline Limited (SNGPL) system, sources said, Petroleum Ministry had denied gas availability for both gas-fired and dual fuel based power projects.

The Pakistan Electric Power Company (Pepco) had written a letter to Petroleum Ministry in June 2008 requesting for supply of gas to the Genco-III power plant and Kot Addu Power Company (Kapco). Subsequently, the Ministry took up the matter with the Managing Director of SNGPL who replied that currently the company was facing a shortfall of 524 mmcfd gas on the network, which probably would increase to 1084 in 2012-13.

'SNGPL is not in a position to supply gas to Wapda plants on sustainable basis due to gap in demand and supply. However, the company would continue to divert all surplus gas to the power sector on 'as and when available' basis,' sources added.

Pepco in its letter to Secretary Petroleum had requested for increase in gas supply to Muzaffargarh thermal power station, GTPs and SPS Faisalabad, NGPS Multan, GTPS Shahdara and Kapco with the argument that most of the machines were being run on expensive furnace oil, which also require more maintenance.

Last year, Petroleum Ministry had reviewed gas availability position and, based on overall projections, PPIB was informed that it was not possible to provide gas for power projects in the private sector, in addition to the allocation already being made for the present projects,' sources said.

Keeping in view the commercial operation date (COD) of planned IPPs, the Petroleum Ministry had placed 300 mmcfd gas at PPIB's disposal for 2007-08, to be followed by 240 mmcfd in 2008-09 and 180 mmcfd in 2009-10, whereas gas already allocated to IPPs is estimated at 151 mmcfd in 2007-08, 227 mmcfd in 2008-09 and 152 mmcfd in 2009-10. According to information provided by the PPIB, it had been noted that up to 51 mmcfd gas in 2008-09 could be provided till October, 2008, which could be further extended if any of the IPPs in the pipeline did become operational as expected (COD), sources added.

'Petroleum Ministry has been asked not to issue comfort letter to the sponsors until gas is arranged for the entire project life of the IPPs, which is possible after 2010-11,' sources said. A official in Pepco said that the public sector power plants were facing shortage not only of furnace oil but also of gas, which is the main reason for the reduction in generation.