Load management plan for winter season: Govt to treat import substitution sector as must-run industry

Our Correspondent
Sunday, Oct 10, 2021

ISLAMABAD: The government has decided not only to treat the import substitution industry as a must-run sector but also to keep it in the top priority sectors for gas supply during the load management plan to be carved out for the winter season.

“And to this effect, the Petroleum Division will soon submit the gas load management plan for the winter season under which the top priority for gas supply will go to the domestic sector followed by power and export industry,” one of the top officials at the Energy Ministry told The News.

However, under the new scenario, the government wants to provide the gas to the import substitution industry as a priority sector such as export industry. The way the government ensures the gas supply to the export industry, we will also give the same treatment to the import substitution industry for gas supply. The export industry earns US dollars and the import substitution industry saves the dollars. “So both sectors are equally important.” However, the official said that the non-export industry, CNG and commercial sector will face the closure of gas when the peak season in winter reaches.

“Yes, we have decided to exempt the import substitution industry like the export sector from ban on gas supply under the directive of Prime Minister Imran Khan. The prime minister wants to treat the import substitution industry as a must run industry such as the fertilizer sector. The prime minister also wants to enhance the LPG production and took a strong exemption of the closure of JJVL LPG and NGL extraction plant, saying the government is importing LPG at the cost of costly foreign exchange reserves despite the fact that country has the JJVL plant in hand for sizeable production of LPG.”

If the JJVL is made functional then the government will be able to save $125 million and more importantly the LPG price per 11.8kg cylinder which has risen to Rs 2,500 may be reduced by 500 per cylinder. And the reliance on imported LPG will also tumble which is the dire need of the time.

The country is already facing a 100 percent increase in trade deficit which will soar, according to the World Bank report, to $12 billion at the end of the current financial year. Keeping in view the burgeoning trade deficit which will have an ultimately adverse impact on current account deficit, the government wants to treat the import substitution industry as a must run industry to save the US dollars being spent on imports. “We have 4 bcfd gas in the system which include 2.8 bcfd local gas and 1.2 bcfd imported RLNG and in the peak demand in winter season rises to 5 bcfd. This means the non-export, commercial and CNG sector will face gas closure in the winter season,” the official said.

Mentioning about the letter DG LG (Liquid Gases) wrote on October 1, 2021 to the managing director of SSGC under the PM directives, asking him to resume the gas supply to JJPL LPG/NGL extraction plant in the light of the ECC decision taken on August 12, 2020, so that the LPG plant could play its role in producing 15 percent of the country’s LPG production, the official said that SSGC BoD met on Saturday and the provision of gas to JJVL plant was one of the agenda items, but the BoD has decided to take it up separately in the next meeting.