The News reported that the fertilizer manufacturing plants supplied by Sui Northern Gas Pipelines Limited managed only around 45% urea production in 2011 against their installed capacity because of non availability of gas.
Fertilizer industry sources said urea manufacturing plants managed to produce only 4.8 million tonnes against the installed capacity of 6.8 million tonnes per year due to low gas availability. The annual demand is 6.3 million tonnes.
Mr Khalid Subhani president and CEO of Engro Fertilizer said that the government needed to review its strategy to overcome the natural gas crisis in the country. Formulation of such strategy is indispensable as winter season has finally arrived and local gas demand has started rising in Punjab and Khyber Pakhtunkhwa, the two large gas consuming provinces. We need to realize the importance of all sectors of the economy while deciding the gas distribution in the country.
The representative of another fertilizer plant who did not want to be named, said that authorities concerned have failed to honor their commitment for the supply of gas to fertilizer sector as per the Gas Sales Agreements and Gas Load Management Policy.
He warned that fertilizer manufacturing factories are being forced to close down due to lack of gas supply, which results in job losses for a large number of highly skilled manpower and huge burden on government exchequer for import of urea.
He said that the gas supply curtailment to fertilizer factories on the SNGPL network during 2011 has been unprecedented. The severity of the winter in Punjab and Khyber Pakhtunkhwa is going to add to the problem owing to increase in gas consumption by domestic consumers.
He reminded that natural gas is the basic raw material for urea manufacturing and for this reason the federal government, in its Load Management Policy 2005, had given first priority for gas supply to fertilizer sector, after meeting the demand of domestic consumers. No fertilizer unit can run without natural gas, the official said and added that all other industrial units, such as those of textile, chemical and steel can run on alternative fuels like furnace oil and diesel.
He elaborated that these factories are using relatively cheap energy source of gas as a fuel in order to just increase their profit margins. Similarly, CNG stations are getting gas four to five days a week, although diesel and petrol are available to run vehicles. The Load Management Policy, which was approved after consultation with all stakeholders, provided third priority to general industries and fourth to CNG stations.
Therefore, SNGPL is not bound to supply gas to general industries during winter months. Contrary to this, these industries are getting gas at least four days a week and SNGPL is simply obliging them at the cost of fertilizer factories.
(Sourced from www.thenews.com.pk)
