INSUBCONTINENT EXCLUSIVE:
CM Sindh urges KE, SSGC to iron out all differences, not to punish peopleKARACHI: Sindh Chief Minister Syed
Murad Ali Shah presiding over a joint meeting of K-Electric (KE) and Sui Southern Gas Company Limited (SSGCL) here at the CM Hose today has
categorically told both the entities that due to their personal disputes he would not allow them to punish the people of this city.The
meeting was attended by SSGC Chairman Board of Directors Lt
(retd) Javed Zia, Board of Directors Agha Sher Shah, Rizwan Kehar, MD SSGC Amin Rajput, Sr GM Saeed Larik, CFO Fasihuddin Fawad
The KE was represented by its Chairman Waqar Siddiqui, CEO Tayyab Tareen, Board of Directors Zubair Motiwala, Khalid Rafi, Mubasher Shaikh,
Freeric Sicre, Chief Generation Officer Dale Sinkle, Chief financial Officers Moonis A
Alvi, and Directors Aamir Qureshi
The chief minister was assisted by his Principal Secretary Sohail Rajput and Secretary Energy Agha Wasif.The chief minister said that
Karachi is currently facing increased electricity load shedding
The KE blames SSGCL for reduced gas supply, resulting in the decreased generation of electricity
The SSGCL denies and claims that 90 mmcfd is being supplies against the old agreement of 10 mmcfd signed in 1970s.He said that in the claims
and counter claims between the two organizations people of this city suffer a lot in this sweltering weather
Therefore, he had written a letter to the prime minister and took this issue with him.It was pointed out in the meeting that SSGCL provides
gas to KE without any gas supply agreement (GSA) for production of electricity from gas-based power generation plants
The SSGCL follows the ECC decisions for supply of gas
It was also noted that from 2001 to 2008, the ECC allocated supply of up to 276 mmcfd gas to KE for its multiple gas-based power plants
The KE has four gas-based power plants which require 180 mmcfd to generate 1104 MW electricity
Additionally, KE requires 10 mmcfd, as pilot fuel, to operate duel fuel gas/furnace oil-based plant at Bin Qasim Power station
It was also told in the meeting that minimum 190 mmcfd gas is required in summer for operating single fuel gas-based plants at full load
The SSGCL has significantly curtailed gas supply to KE and the current supply is 90 mmcfd
The average for 2017 was 141 mmcfd versus 177 and 167 in 2015 and 2016 respectively
The chief minister was told that there was KE-SSCGL billing dispute
The KE-SSGC bills payment issue first surfaced in 2010 when KE defaulted on payment of cumulative bill of arrears of Rs10 billion
Since, SSGCL has been charging mark up at the rate of 15.5 percent on the arrears
The two entities signed a payment plan in 2014
As per their agreement plans, the KE was obligated to pay arrears in addition to current billing, if agreed benchmark gas supply is met
According to KE outstanding balance towards SSGC is Rs13,7 billion while SSGC says the receivable are Rs80 billion
The chair was also told that KE contests SSGCL markup claim and considers it as an outcome of circular debt
Moreover, markup is not charged on other entities like KWSB etc
Now the matter is pending in the Sindh High Court.The chief minister talking about summer situation said that said the peak demand is
expected to be around 3,400 MWs, shortfall at peak summer time would be 400 MW provided all plants of KE are running at their full capacity
He added that KE requires at least 190 mmcfd supply of gas as in previous years to run its single fuel gas plants to ensure smooth supply of
power to domestic and industrial consumers
consumers.Murad Ali Shah concluded that with the gas supply at the current level of 90 mmcfd the power shortfall would further increase by
500 MW in addition to the exiting 400 MWs in peak summer
He urged both the entities to sit together from Monday and by Wednesday iron out all their differences whether they would have to sign the
new agreements and payment plans but on Thursday he wants a solution to the problem
