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Defaulting CNG outlets not to get LPG licence

ISLAMABAD: While complementing the Oil and Gas Regulatory Authority (Ogra) for promoting additional fuel in the country, the National Assembly Standing Committee on Petroleum and Natural Resources on Tuesday directed Ogra to ensure that the defaulting CNG stations are not converted to LPG stations.

Chaired by Chaudhary Bilal Ahmed Virk, the committee directed the Ogra to amend rules to ensure that the defaulters of utility companies remain out of business.

The ruling was passed after complaints by the SNGPL and the SSGC that their defaulters have been given licences to operate as LPG Refueling Stations without an NOC from the gas utility companies.

However, Ogra officials apprised the committee that CNG and LPG sectors were being dealt by separate set of Ogra rules and no such provision was available wherein operations of LPG Auto Refueling Stations at existing CNG stations is linked to clearance of dues of gas utility companies.

It was decided that Ogra would amend the rules and make it mandatory that all applicants would require to submit ‘undertaking’ from the applicant that the company was not defaulter of any utility company.

Shahid Khaqan Abbassi, Minister for Petroleum, informed the committee that OGDCL and other oil and gas exploration companies made six discoveries in June, and were adding around 50.1mmcfd gas and 3,259 barrels of oil per day in the system. The minister said that major discoveries have been made in Sindh.

He said that six discoveries in a month are a record. He said that out of six, four discoveries were made in Sindh and two in KPK. Two discoveries have been made by OGDCL, two by Hungarian firm MOL, one by PEL and one by UEP.

According to Managing Director (MD) SNGPL, Amjad Latif, the country was depleting 100 million cubic feet gas per day and the local gas supply was not even enough to meet the daily requirement of domestic consumers.

He said that purchasing cost of gas for domestic consumers stands at Rs510 per mmbtu, but domestic consumers under first slab were receiving it at Rs110 per mmbtu.

He said that 85 per cent domestic consumers were paying less than 50 per cent cost of gas, while industrial and commercial consumers were cross-subsidizing these consumers.

However, commercial and industrial consumers had been switched to LNG. Therefore, burden of cross-subsidy was being shouldered by the SNPLG which has hit the company.

Despite decline in gas production, he informed the body that 8,000 kilometers pipeline would be laid during the ongoing year.

He said that SNGPL has a network of 0.3 million consumers whereas 1.5 million applications for new connections are pending.