ISLAMABAD - Due to depleting domestic reserves, rising consumer database, failure to curb gas theft, generous allocation to fertilizer industry and stalled plans to import gas from overseas, the country in winter this year is all set to face the worst energy crisis of the history, The Nation has learnt.
According to sources, last year gas deficit soared up to 3 bcfd (billion cubic feet per day). With new connections, depletion of reservoirs and increasing gas theft this number is expected to exceed 3.5 bcfd, there would be very short supply of gas for general consumers and that too at exorbitant price.
“In order to get political mileage and quick money for the national kitty, the present government got approval of issuing 0.5 million new gas connections at an urgent fee of Rs25,000 from Ogra this year and since then distribution companies have been speedily issuing them,” the sources claimed.
According to data, at the end of financial year 2014, around 1.5 million applications for new gas connections were pending with Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company Limited (SSGC), out of which 1.4 million applications were pending with SNGPL and over 90,000 thousands with SSGCL. According to sources, these new 0.5 million connections would put additional burden of 100-150 mmcfd (million cubic feet per day) on the system.
Due to depletion of reserves, the gas production this year would be less than that of last year. According to petroleum ministry data, gas production in 2013-14 was 4.1 bcfd whereas in 2014-15 it would drop down to 3.8 bcfd due to depletion of reserves. In 2011, the shortfall in demand and supply of natural gas was one bcfd. According to official data, in 2011 it was estimated that if new connections were not restricted gas shortfall would surge to 2 bcfd in 2014-15.
While seeking permission to issue new allowances from Ogra (oil and gas regulatory authority) the government pleaded that it would add new gas to the system this year. But that has turned out to be just a political statement.
“By next month, 20 mmcfd is expected to be added to Sui Southern from Zarghon fields, which would supply gas to Quetta. KPD, Kunar and Makori gas fields are also expected to add more gas to system by December this year, but the total addition would be not much affective to offset the cumulative affect of increased consumption and depletion of older reserves, sources said.
Gas theft, conveniently referred as unaccounted for gas (UFG) is another major factor in worsening gas crisis which has soared up to 16 percent. It means that 16 percent of total gas is stolen with the connivance of gas distribution company staff, the sources said.
According to SNGPL official data, during January 2012 to February 2014 gas theft of Rs12.7 billion was detected, out of which company could recover only Rs3 billion. The government has been portraying as if gas crisis would be overcome with import of 200 mmcfd LNG, but informed sources believe otherwise.
“200 mmcfd is very small quantity as compare to 3 bcfd deficit in peak winter. The gap is so large that LNG would have little or almost no affect in gas crisis; secondly, LNG would be imported at international price and when this costly fuel would be added to national system, the overall cost of gas would go up. Resultantly, the prices of natural gas for domestic, industrial and commercial consumers would shoot up.”
The government has no plans to cut gas supply to influential and powerful fertiliser industry, which burn 500 mmcfd natural gas per day as raw material. This gas is supplied through dedicated lines from Mari gas since last many years when gas was available in abundance and there was a surplus of 1-2 bcfd. Three years back, the ministry of petroleum forecasted that the demand-supply gap would increase to 3 bcfd in 2015-16 and 3.5 bcfd in 2016-17, but no steps were taken. Though present government claims it is devising plans to address the issue but on ground no mentionable progress has been made.
Experts believe there is little that Nawaz government can do to alleviate the crisis in the short run, and they noted that besides other problems, major energy initiatives by his two immediate predecessors have backfired or become mired in international disputes.
Pervez Musharraf, the general who ruled the country from 1999 to 2008, launched a campaign to wean Pakistani drivers off imported petroleum-based fuel and promote compressed natural gas – the energy source that the country had in abundance. At that time one bcfd natural gas was in surplus. It was under this policy that huge gas supplies were granted to fertiliser industry at a very nominal rate.
Though for a brief period, the effort was so successful that millions of vehicles would run on compressed natural gas and the fertiliser industry boomed. But in the long run this policy has left common man gasless and reserves have been heavily depleted.
A second, more ambitious proposal to build a gas pipeline from Iran has been stalled by opposition from Washington and the inability to obtain international financing, although from time to time fruitless meetings do take place.