Govt working to put gas bills within reach of consumers in winter: Musadik

ISLAMABAD: Federal Minister for Petroleum Musadik Malik said on Wednesday a mechanism was being evolved to keep the gas bills within the reach of consumers in the winter season when its use increases manifold.

In an interaction with a group of media persons here, Malik said: “The government is working on the option to introduce seasonal tariff of gas and electricity. Under the arrangement, the supply of electricity would be increased in winter season but its tariff would be reduced, and the bills would continue to be in the range of consumers. The same will be applied in the case of gas. During summer, the price of gas would be increased to some extent, as its consumption is reduced. But in the winter season, gas consumption increases and the gas price would be reduced. It would provide relief even after one uses gas in abundance. And this is how the revenue requirement would be met.”

The minister said he was trying to provide the system gas to RLNG power plants so that the basket price of electricity could be lowered. At present, plants which are operating on imported gas as fuel are generating electricity at Rs24-26 per unit, depending on the value of dollar. This is why these RLNG power plants are not competing with other cheaper plants in the economic merit order, so the said plants are not fully operational. This is why the line pack in the main pipeline sometimes increases to more than 5bcf, putting the national gas transmission system in jeopardy.

The minister said that during the winter season, the capacity payments crisis further exacerbates, as consumption of electricity dwindles in the range of 8,000-10,000MW, which increases up to 25,000-26,000MW in the peak summer season. He said the government is working on the winter package for all categories of electricity consumers under which the electricity price would be made affordable so that the electricity consumption could jack up to at least 15,000-20,000MW to tackle the monster of the capacity payments issue. In addition, the minister said a committee, headed by him, was also working on switching the space and water heating to electricity from gas in the winter season.

Coming to the thorny issues of the amended E&P Policy 2012 that the CCI approved under which the E&P companies would sell 35pc gas to the private sector, the minister said that implementation framework would be presented in the next meeting of the Task Force on gas related issues, headed by Deputy Prime Minister Senator Ishaq Dar. He said his ministry had resolved the issues hindering the implementation framework under which the E&P companies would be taken care of. The minister said the process to seek investment from one of the friendly countries in the Reko Diq project was at an advanced stage, and the evaluation of shares, which were to be offloaded, was in process and the transaction might take place in next two, three months.

As far as investment for green refinery is concerned, Musadik said PSO had commissioned the market study for the refinery, which would be completed by December this year

He avoided responding on Iran-Pakistan (IP) gas pipeline keeping in view the sensitivity of the project but said that there was no truth at all about the amount of penalty of $18 billion Iran had asked for. The minister said the figure held no truth.

He mentioned various committees were working on options to reduce the electricity tariff, which showed the level of seriousness of the incumbent government. He said once the task force on power sector issues furnishes its recommendations to the premier, a sizable relief in tariff would be given to consumers.