PM calls CCoE meeting in Karachi to resolve K-Electric, SSGC dispute

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ISLAMABAD: As the row between K-Electric and Sui Southern Gas Company (SSGC) continues, the federal government is anticipated to establish a mechanism and time frame for resolution of dues owed to and by K-Electric.

A meeting of the Cabinet Committee on Energy (CCoE) is set to be held on Monday, which will be headed by the Prime Minister Shahid Khaqan Abbasi, reported Dawn.

The federal govt has prepared working papers for this meeting and it will discuss the at-source subtraction of various provincial bills and to enable smooth operation of SSGC and K-Electric.

An official said the working papers had established both K-Electric and SSGC required cash and gas flows to resolve the woes of Karachi’s citizens.

Both utilities are going to be instructed to conclude terms of their agreements about payment and supply of gas under a strict time period.

Also, the provincial government’s help is going to be sought to finalize a separate agreement between Karachi Sewage and Water Board (KWSB), K-Electric with the help of the federal government.

The official disclosed the finance ministry had shown the inclination for clearance of KWSB dues on stipulation it would do at-source subtraction against the provincial share in the federal divisible pool.

However, the federal government has claimed KWSB bills were the duty of the Sindh government, especially after the distribution as per the 18th Amendment and the 2009 National Finance Commission Award.

The meeting is set to be held in Governor’s House in Karachi and will be attended by adviser to PM on finance Miftah Ismail, federal ministers for power, railways and water resources, secretaries of power, water, privatization, finance and cabinet.

Managing directors of SSGC, K-Electric, and Pakistan State Oil (PSO) have been invited to the special CCoE meeting as well.

In a letter written by Power Minister Awais Ahmad Khan Leghari to Sindh Chief Minister Murad Ali Shah stated KWSB was the responsibility of the provincial government due to the 18th Amendment.

Mr. Leghari highlighted this responsibility couldn’t be negated by any contractual agreement and the input, support of the Sindh govt was critical in resolving this row,

Currently, K-Electric is owed Rs52 billion by KWSB whilst SSGC claims its receivables from the former stand at Rs80 billion which doesn’t include Rs7 billion security deposit for raising gas supply from 10mmcfd to 190 mmcfd.

National Transmission and Dispatch Company (NTDC) claims its receivables from K-Electric stand at Rs30 billion respectively.

The power minister said the Sindh government needed to realize provincial departments including KWSB couldn’t evade their responsibility of paying for electricity services being provided to them by K-Electric.

He said the provincial government on its part needs to acknowledge this problem and address the issue of the departments’ default.

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