Lifting ban on gas connections questioned: PEW

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Customers not enthusiastic about imported gas
The Pakistan Economy Watch (PEW) on Thursday questioned decision of the Cabinet to lift ban on new domestic and industrial gas connections terming it a flawed decision.
The decision has raised questions about the LNG policy and the efficiency of the power sector, it said.
Government has lifted ban on new gas connections which was imposed during 2011 as the supply of imported gas has increased while demand in insignificant, said Dr. Murtaza Mughal, President PEW.
He said that as a rule governments bound customers for purchase and then import gas but in Pakistan the LNG import deal was signed before finding the customers.
The imported gas is costly therefore customers are not using it willingly and delaying paying the bills which was resulting in circular debt therefore ban was lifted.

Dr. Murtaza Mughal said that government has planned three new LNG-based power plants in Punjab which will push up the number of gas-based power plants to eleven requiring 1127 mmcfd of LNG.
None of the said power plants is working according to its capacity but when the same start operations there will be no gas for those who sought new connections.
New connections were allowed to avoid penalties government will have to pay if it refused to buy LNG, he said, adding that the gas will become costly as it is linked to crude oil whose price is out of the control of the government.
Presently one terminal with capacity of 600 mmcfd is operating while another with the same capacity will start commercial operation within three months and out of total 1200 mmcfd of LNG 1127 mmcfd will be consumed by the Punjab’s power sector, he said.

In: Economy WatchAuthor: AAMIR JAVED