New govt to go-ahead with plan of breaking-up gas utilities

This plan was put forth before the Prime Minister Imran Khan by the Ministry of Energy (Petroleum Division) in a meeting on Tuesday

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ISLAMABAD: The new PTI government has decided to move ahead with the previous government’s plan to spin off gas utilities into smaller units which will enable efficient delivery of services and check Rs50 billion yearly gas theft.

The plan envisages the division of the transmission and distribution businesses of gas utilities into four distribution entities and a solitary transmission company reports Express Tribune.

This idea was initially put forth by the PPP government during its previous tenure and was followed up by the previous PML-N government in assistance with the World Bank (WB).

The previous government had hoped to conclude the splitting up of gas utilities by the start of July last year but was unable to meet the deadline.

This plan was put forth before the Prime Minister Imran Khan by the Ministry of Energy (Petroleum Division) in a meeting on Tuesday.

The PM directed the division to table the summary of a meeting of the Economic Coordination Committee (ECC) for contemplation.

Furthermore, PM Imran Khan asked the division to formulate a comprehensive plan to curb gas theft, which was costing the national exchequer Rs50 billion annually.

After conclusion of the breaking-up of gas utilities, every province will have its own company and it will be responsible for checking gas theft in its area of jurisdiction.

In the tenure of the previous PML-N government, steps were undertaken to establish separate units in order to obtain funds from WB and Asian Development Bank (ADB).

And the mechanism of separating operational and accounting functions for transmission and distribution businesses of Sui Southern Gas Company (SSGC) and Sui Northern Gas Pipelines Limited (SNGPL) was initiated in January last year.

This process was carried out as part of energy sector reforms under a stipulation put forward by multilateral donors.

As per this plan, the government would issue policy statement, which is a critical backbone towards addressing worries regarding the gas sector to protect interests of all stakeholders.

Also, officials shared the PTI government would bring all provinces on board in executing the plan to break-up gas utilities and regulatory environment would become friendly for implementation of regulatory reforms.