SNGPL restores gas supply following a chaos – Pakistan oil and gas sector update

SNGPL restores gas supply following a chaos – Pakistan oil and gas sector update

The Sui-Southern Gas Pipelines limited (SNGPL) has restored gas supply to 551 CNG stations, it is learnt.

According to sources in the Ministry of Petroleum and Natural Resources, the ministry on March 3 suspended gas supply to 551 CNG filling stations in Punjab for three months up to May 31 with the plea that these outlets have a gas supply agreement with SNGPL
on the basis of as and when available.

The Sui Northern Gas Pipelines Limited (SNGPL) had notified that all CNG stations set up after 2008 were eligible for only 9 months gas supply and their supply was being immediately suspended for the next three months.

Sources said that the APCNGA had approached the Prime Minister Syed Yousuf Raza Gilani over the suspension of gas supply to these CNG stations and on the intervention of high authority gas supply had been restored to these CNG outlets.

More than 3.5 million vehicles are using CNG as fuel, which according to official estimates consume 390 Million Cubic Feet gas per Day (MMCFD).

The government wants to reverse its CNG policy but alliance of transporters and CNG investors have created a major pressure group that could put on halt any such plans. Keeping in view the pressure of the transporters and APCNGA, the Petroleum Ministry has
now opted for a plan B to bring CNG prices at par with POL prices.

The decision was rejected by the All Pakistan CNG Association (APCNGA) saying that the government’s move was unjustified and illogical.

According to APCNGA, the government had made an agreement with the association that the gas load shedding would be reduced from February. However, the SNGPL had notified an increase in the duration from two-and-half days to three days, which was illogical,
as domestic pressure on gas reduced with the start of the spring season.

The Oil and Gas Regulatory Authority (Ogra) had cancelled 151 licenses of the CNG stations last week.

The government estimates that during the last decade, gas production has increased by only seven per cent, while its consumption increased by 40 per cent per annum. CNG sector is identified as the major user of gas whose consumption has increased by 39 per
cent per annum during the last decade.

The government has already imposed a ban on the import of CNG kits and cylinders on December 15, 2011, which raised serious concerns in the automobile sector, saying the move would jeopardize investment.

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Posted by Ahmed Tariq on Mar 13 2012. Filed under Pakistan, Sci-Tech. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry