business
Monday Dec 06 2021
By
BDBusiness Desk

Businessmen decry SSGC's request to hike gas price

By
BDBusiness Desk
— Reuters/File
— Reuters/File

  • "It is high time gas be returned to Sindh which, despite producing 76% of country’s overall gas, remains deprived," BMG chairman says. 
  • Zubair Motiwala notes that the industries and CNG stations in other provinces remained fully operational throughout the week.
  • “As we are more efficient, we must be given preferential treatment in terms of energy supply,” he demands.


KARACHI: Businessmen Group (BMG) Chairman Zubair Motiwala on Monday said this is not the right time to increase gas prices hence, the gas price hike request must be straightaway rejected.

According to a statement issued by the Karachi Chamber of Commerce and Industry (KCCI), he said the Sui Southern Gas Company (SSGC) should come up with pragmatic ideas to deal with its revenue shortfalls instead of requesting an increase in gas prices.

“The industries have already been through severe crises and are now in a takeoff position as they have invested heavily in improving their production by installing new machinery hence, any increase in gas prices should be deferred for a period of at least six months”, he added while speaking at a public hearing organised by Oil and Gas Regulatory Authority (OGRA).

“While the government encourages to go for industrialisation and import substitution and also provides finances at 1% mark-up on imports of machinery, how can the industries run all these machines when they don’t have any gas available to them”, he asked, adding that the industries remain deprived of gas in SITE area since November 11 and the situation must also be the same or even worse in other industrial zones of Karachi.

The former KCCI president pointed out that, in yesteryears, a total of 211mmcfd gas, which has now depleted to 180mmcfd, was erroneously given to SNGPL from Sindh’s gas resources.

"It was high time that this gas must be returned to Sindh which despite producing 76% of country’s overall gas remains deprived," he demanded.

The BMG chairman highlighted that 54% of the exports were taking place from Karachi which contributes 68% of revenue and recently more than $3.5 billion have also been invested here on the installation of new machinery which would certainly give rise to the exports and generate employment opportunities. 

He noted that the industries and CNG stations in other provinces, who have been receiving Sindh’s gas, remained fully operational throughout the week and "we remained deprived".

"The energy being consumed by the industries in Karachi was much lower as compared to what was being consumed by the industries in the northern areas who export 46% while Karachi-based industries have been exporting 54% by utilising lesser electricity and gas.

“As we are more efficient, we must be given preferential treatment in terms of energy supply,” he added.

He further suggested ending SSGC’s monopoly by creating distribution zones and giving the task of supplying gas to consumers in these zones to other players while the SSGC should remain confined to supplying bulk gas to the new players only.

To efficiently deal with gas crises, Motiwala recommended that the domestic consumers should be compelled to switch to solar geezers which can be provided by SSGC, while the cost of these geezers can be recovered through gas bills in the form of monthly instalments for up to 10 to 12 months.