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Musadik Malik says gas load-shedding inevitable despite extra LNG in January

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2 years ago

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  • Country to have additional 200 million MMCFD LNG in Jan-Feb.
  • Govt encourages private sector to invest in new LNG terminals.
  • Planning to import 20,000 tonnes of extra LPG for winters.

ISLAMABAD: Musadik Malik, the Minister of State for Petroleum, on Monday warned that gas loadshdding is inevitable in the coming months despite the arrangement of additional 200 million cubic feet per day (MMCFD) liquefied natural gas (LNG) in January-February 2023, compared to the same period last year.

“Despite the availability of an extra LNG cargo during the upcoming peak winter season, gas load-shedding will be inevitable,” Malik said while briefing the Senate Standing Committee on Petroleum in a meeting held under the chair of Chairman Committee, Senator Mohammad Abdul Qadir.

“In January, Pakistan will have ten LNG cargoes, while in February nine of them will be available for local consumption, while this extra liquefied gas will be imported by state-run companies.”

Malik said the government would encourage the private sector to invest in new LNG terminals.

The state petroleum minister was critical of the supply of gas to the fertiliser-makers at discounted rates.

“The gas costing Rs4,000/MMBTU was being supplied to the fertiliser factories for just Rs250/MMBTU under the pressure of the fertiliser mafia,” the minister said.

A poor common consumer pays $17/MMBTU, while the exporting sector gets the same gas for $9/MMBTU; however, it is provided to the fertiliser-makers at a meagre $1.35-3/MMBTU.

“It is true exports are also important, the gas sector circular debt has ballooned to Rs1,500 billion,” he said adding, “We have to strike a balance between gas prices. We did not buy gas when it was available at $2-2.5/MMBTU. Now it has reached $40/MMBTU.”

Malik also informed the meeting that the country was also planning to import 20,000 tonnes of liquefied petroleum gas (LPG) for winter months.

Speaking on the occasion, PTI’s Senator Saifullah Abro said foreign investment in the gas sector would be highly welcome. “However, we need to be careful lest these investing companies should trap the country into paying them capacity payments like some independent power producers (IPPs),” Senator Abro said.

During the meeting, Abro and Malik traded barbs over mismanagement in the buying of LNG.

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Irfan Siddiqui meets with the PM and informs him about the Senate performance of the parliamentary party.

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The head of the Senate’s Foreign Affairs Standing Committee and the PML-N’s parliamentary leader paid Prime Minister Muhammad Shehbaz Sharif a visit in Islamabad.

Senator Irfan Siddiqui gave the Prime Minister an update on the Parliamentary Party’s Senate performance.

Additionally, Senator Irfan Siddiqui gave the Prime Minister an update on the Senate Standing Committee on Foreign Affairs’ performance.

He complimented the Prime Minister on his outstanding efforts to bring Pakistan’s economy back on track and meet its economic objectives.

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SIFC Increases Direct Foreign Investment: Investment in the Energy Sector Rises by 120%

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The Special Investment Facilitation Council is intended to help Pakistan’s energy sector attract $585.6 million in direct foreign investment in 2024–2025. The amount invested at the same time previous year was $266.3 million.

This is a notable 120% rise, mostly due to investments in gas exploration, oil, and power. Such expansion indicates heightened investor confidence and emphasizes the development potential in important areas.

The State Bank reports that foreign investment in other vital industries has increased by 48% to $771 million.

This advancement is a blatant testament to SIFC’s efficient investment procedure and quick project execution.

The purpose of the Special Investment Facilitation Council is to establish Pakistan as an investment hub by aggressively promoting regional trade and investment in the energy sector and other critical industries.

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Business

Discos report losses of Rs239 billion.

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When compared to the same period last year, the data indicates that discos have decreased their losses in the first quarter of the current fiscal year.

The distribution businesses recorded losses of Rs239 billion in the first three months of the current fiscal year, a substantial decrease from the Rs308 billion losses sustained during the same period the previous year.

Additionally, the distribution businesses’ rate of recovery has improved. It has increased to 91% in the first quarter of this year from 84% in the same period last year, indicating success in revenue collection.

Regarding circular debt, the Power division observed a notable change. Last year, between July and October, the circular debt grew by Rs301 billion. Nonetheless, this year’s first four months saw a relatively modest increase in circular debt, totaling about Rs11 billion.

These enhancements show promising developments in the electricity sector’s financial health in Pakistan, where initiatives are being made to accelerate recovery rates and slow the expansion of circular debt.

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