Time for a Fresh

Energy Model
BY ZAIN UL ABDIN
Gas Shortage

 Controversies and injustice over shortage.

 Thedebate is shifted towards the affordability due to
import of LNG.
 The power system failed to consume half of the LNG that
was ordered during summer due to gradual decrease in
economic activities.
Gas Shortage

 The power consumption plunged and the power system just

completely removed the LNG use.
 LNG was justified cheaper than furnace oil.
 Because of poor governance and management of the government the
gas companies were reluctant to place further orders for LNG.
 LNG costing 32 billions.
 Article 158

 With the decrease in the gas pressure of some important cities of

Sindh. The province decided to use article 158.
 Article says that “The provinces producing the natural gas have
the right to consume all of the resource until the requirements
are completely meet.”
 According to that article Sindh has 68% monopoly over the entire
gas produce by country. That is more than half.
Federal’s Interpretation

 But the attorney general said that “Not just the resident of any single
province but all the resident of Pakistan have to use the resource as
they the ultimate owner of the resource.” According to the attorney
the article has 3 parts.
1. Royalties of wellhead belong to the provinces where it is located.
2. Policy making about the wellheads belong to the federation.
3. The operation and the management of supplies rest with the Centre.
Dispute

 During the previous CCI meeting on dec 23 2019 the minutes were
delayed and the letter of appreciation was written to PM from CM
Sindh.
 Later on federal minster and PM’s assistant on petroleum reported
that a broad agreement has been made with the Sindh govt by
introducing a weighted avg cost method.
 At the same time blamed Sindh for delaying or non-issuance of right
of way for gas pipeline at three points.
Dispute

 “We have to go for weighted average cost of gas because LNG is

also a source of gas and not a petroleum product,” announced
Special Assistant to the Prime Minister on Petroleum Nadeem
Babar.
 Petroleum division claims that out of 2243 million cubic feet per
day 1300 mcfpd is put into SSGC and 700 direct to power and
fertilizer while remain 200 mmcfd goes out of Sindh.
 Sindh rejects that claim and believes that the center is illegally
adding regasified LNG into weighted average cost due to which
costs is rising.
Solution

 Pakistan should move out of such contradictory policies

and shift to a single energy basket.
 This single energy basket could be used universally.
Different provinces have different energy resources that
can be synergized. It will take time but its worth the effort.