- The supply will be stopped for three months from December 5.
- SSGC is facing severe shortage in gas supply.
- Government policy prioritizes gas for domestic sector: SSGC.
ISLAMABAD: Sui Southern Gas Company (SSGC) said it will cut supply to gas-based power plants amid significant shortfall in the domestic sector and increased demand during winter, especially in Balochistan. the news Sunday report.
According to a statement, the utility informed power plants that it was exercising a clause in gas sales contracts that allowed it to cut off supply, adding that the supply would be shut off for three months starting Dec. 5.
“Federal government policy prioritizes gas supply to the domestic sector,” it said.
SSGC has been facing a severe shortfall in gas supply, which has declined by more than 39% in the last six years, from 1,200 million cubic feet of gas (MMCFD) in FY2018 to 730 MMCFD in FY2024.
A downward trend in gas supply is evident when examining data from previous fiscal years. In FY19, gas supply to SSGC was recorded at 1,164 MMCFD, followed by 1,087 MMCFD in FY20, 984 MMCFD in FY21, 921 MMCFD in FY22, and 847 MMCFD in FY23.
The downward trajectory continues, with the latest figures for FY24 reflecting a further decline to 730 MMCFD. This declining trend raises concerns about the sustainability and adequacy of domestic gas resources to meet the growing demands and requirements of various sectors.
Due to shortage of indigenous gas in the system, gas supply under ‘Gas Supply Agreement for Power Generation’ has been temporarily stopped. The moratorium is scheduled from December 5, 2023 to February 29, 2024, pursuant to Section I of the Gas Supply Agreement (GSA) for Power Generation. It has been mutually agreed by the concerned parties to stop gas supply during this period.
“Gas will be supplied by the company only on an ‘as and when available’ basis between March and November every year. Consumers will arrange for dual fixing to avoid loss of production and when gas is not available during March to November and also from December to February when the company supplies,” the agreement said. It will cut off gas supply to customers every year at its cost.”
The SSGC also stated that the terms and conditions set out in the GSA between the parties expressly guaranteed the company’s right and approval to suspend supply from December to February every year.
Consequently, in response to the acute shortage and unavailability of gas in the system to meet the demand of domestic consumers, SSGC is implementing gas supply curtailment effective December 5, 2023. This action is being taken following the provisions described in Clause I. of GSA.
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