SNGPL agrees to wave off 66pc ‘Take or Pay’ clause for state-owned LNG plants

SSGC invites expression of interest for production of bio gas in its franchise area

ISLAMABAD: Minister for Energy Hammad Azhar on Friday said the Board of Directors of Sui Northern Gas Pipelines Limited (SNGPL) had agreed to waive of 66 per cent ‘Take or Pay’ clause for the government-owned Liquefied Natural Gas (LNG) plants.

“In the long run, this will help in reducing the capacity payments that the government has to pay to power plants even when they are not supplying electricity,” he tweeted.

 The minister said the board also approved, in principle, the company’s pipeline capacity allocation for Energas for its upcoming LNG terminal that “will supply gas on a B to B [Business-to-Business] basis.”

Hammad said this would pave the way for private sector entities to supply the commodity to their consumers and ensure availability of LNG across the country.

Meanwhile in another tweet, the minister for Energy underlined the need for exploiting the country’s full potential of bio-gas to meet energy requirements of consumers.

“Pakistan has till now ignored the huge potential of bio-gas for too long now. SSGC has invited the expression of interest for producing bio-gas in its franchise area. SSGC is expecting to produce 4-5 MMCFD through this endeavour as a pilot project,” he said in a tweet.

The minister said Sui Southern Gas Company (SSGC) had invited the expression of interest for producing bio-gas in its franchise area, adding ”SSGC is expecting to produce 4-5 MMCFD [Million Cubic Feet per Day] gas through this endeavor as a pilot project.”

The development comes amid a gas shortage in the country with the government deciding to priortise gas supply to the power and fertiliser sectors last month.

It may be mentioned here that the import of LNG went up by 101.94pc to Rs72.372 billion against Rs35.837bn over last year; the import of bituminous coal also increased by 120.36pc to Rs41.339bn against Rs18.760bn over the last year.

While the LPG import also witnessed an increase of 78.63pc to Rs9.320bn against Rs5.217bn over the last year and similarly, the import of furnace oil posted growth of 243pc to Rs6.457bn in November for power generation against Rs1.881bn last year.

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