K-Electric & SSGC given 24-hour ultimatum to resolve dispute

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ISLAMABAD: Ministry of Energy efforts to resolve the raging dispute between K-Electric and Sui Southern Gas Company (SSGC) over outstanding payments and fuel supply failed on Friday.

Both the companies have been given a 24-hour ultimatum to resolve their dispute by the energy ministry, reported an English daily.

The Sindh government was requested by the Minister of Energy Awais Khan Leghari to play its due role in resolving the dispute between K-Electric and SSGC.

According to SSGC, it is owed Rs78 billion for gas supplies in the last few years and KE claims the principal outstanding amount stands at Rs13 billion and the remainder is either interest or markups.

The payment row between the two companies led SSGC to decrease gas supplies to K-Electric, which consequently impacted its power generation and led to increased power outages in Karachi.

K-Electric is mainly reliant on gas as a fuel for power generation due to the government’s allocation of 276mmcfd of gas supply to the company, said the company spokesperson.

National Electric Power Regulatory Authority also accepted that SSGC was bound to supply K-Electric with 276 mmcfd of gas, shared the spokesperson.

And the energy ministry requested the Sindh government to aid in the recovery of the receivables of K-Electric which were pending against several government departments.

Mr. Leghari took note of the present power situation in Karachi, which had impacted domestic consumers as well as industries.

In a letter sent to the ministry of energy, Nepra stated K-Electric had been forced to conduct power outages because of insufficient gas supply.

The power sector regulator warned the ongoing situation could not persist for an indefinite period and highlighted if even K-Electric initiated all other corrective measures, sufferings of the consumers couldn’t be fully eradicated.

Nepra contended for an immediate need of supplying 190 mmcfd of gas per day to K-Electric.

Also, Mr. Leghari instructed K-Electric to ensure it would bring all its power units online to give relief to Karachi’s citizens.

The private power utility’s management apprised the meeting it was getting power from the national grid and independent power producers besides its own sources resulting in the provision of 2,300 megawatts of power supply to Karachi.