Gas consumers to pay for leakage, theft

ISLAMABAD: The government is planning to allow gas companies to recover greater amounts from consumers on account of gas lost due to theft and leakages, effectively bailing them out, according to sources. A government official said that Petroleum Minister Shahid Khaqan Abbasi would soon chair a meeting of top officials of the Oil and Gas Regulatory Authority (Ogra) and the gas companies to finalise recommendations for increase in the limit for unaccounted for gas (UFG), to ensure higher revenues for the Sui Southern Gas Company Ltd (SSGCL) and Sui Northern Gas Pipelines Ltd (SNGPL). This is being seen by many as recognition by both the government and the regulator of the utilities’ inability to control gas losses and to legitimise a change in performance standards. Such a change in standards when made by former Ogra chairman Tauqir Sadiq landed him in legal trouble. This is for the first time that the regulator itself has sought intervention of the government to fix benchmarks, a responsibility Ogra has been exercising since its inception in the late 1990s. More importantly, a government officer pleading the case on behalf of the gas companies has now asked the government to take a policy decision. About a month ago, Ogra requested the government to issue policy guidelines pertaining to thieves and pilferers and the gas lost in areas adversely affected by law and order problems. Ogra member Amir Naseem, who was working for the SNGPL until a few months ago, has written a letter to secretary of petroleum and natural resources ministry to issue policy guidelines on UFG. He said that factors like diversion of gas from bulk consumers to retail customers due to load curtailment, massive expansion of domestic connections, shortage of gas, and load management policy of the government had served to increase the gas losses of the companies. He said that bulk consumers were less prone to leakages and because of their high volume could be better monitored by the gas companies but retail consumers to whom gas had been diverted in the recent past were more prone to leakages and theft. “This shift from bulk to retail consumers is not in their (gas companies) control and mainly governed by policies of the government,” he said. An official said that Ogra had urged the government to increase UFG benchmark by around 3 per cent besides an allowance of about 1.5 per cent on account of gas lost in law and order-hit areas.