KARACHI: Gas supply suspension to Karachi’s industrial zones could impact the livelihoods of up to 250,000 workers, heads of Karachi industry bodies said on Monday, warning that economic recovery would suffer if measures were not taken in a timely manner to rectify the situation.
Since the start of the winter, Pakistanis using natural gas for cooking and heating, as well as factories and power plants that rely on the fuel, have experienced significant inconvenience due to low gas pressure or no supply at all.
Factories and business in the port city of Karachi, Pakistan’s commercial hub, have been badly affected, threatening jobs and the livelihoods of workers.
Indeed, December and January see the largest spike in demand for gas in Pakistan, but this year authorities have said the demand-supply shortfall is greater on the back of higher consumption and diminishing indigenous supply.
Pakistan, chronically short of natural gas, diverts supplies from industries and power plants to domestic consumers in winters, disrupting production activities.
Industrialists say a shutdown of business activity due to gas shortages has put at risk the livelihoods of up to 250,000 workers in all seven zones of Karachi.
“In our association there are around 8,000 worker who have been affected due to the situation and there would be more than 250,000 workers who are directly affected in seven industrial zones,” said Naveed Shakoor, president of the Bin Qasim industrial zone.
#WATCH: Industrialists say gas shortages in Karachi has shutdown business activity placing livelihoods of up to 250,000 workers at risk in all zones of the city. || @SSGCL #Pakistan #GasShortage
-
Read more: https://t.co/b0jpT8cOxz pic.twitter.com/WB5RyerQE5— Arab News Pakistan (@arabnewspk) January 12, 2021
“The gas supplies of more than 474 captive power plants has been suspended for the last 15 days, which has rendered more than 50,000 daily wagers out of work,” Faisal Moiz, president of the North Karachi North Karachi industrial zone told Arab News after a press conference by representatives of Karachi’s seven industrial zones.
“Gas supplies have adversely impacted almost all industries including pharmaceuticals, food suppliers, textile and export oriented manufacturing units and their suppliers are suffering,” Moiz said, adding that many industries had suspended operations altogether.
#WATCH: Traders worry that gas suspension to industries in Karachi can place livelihoods of up to 250,000 workers at risk, leading to cessation of business activities in the megalopolis. || @SSGCL #Pakistan #GasShortage
-
Read more: https://t.co/b0jpT8cOxz pic.twitter.com/NMkn5RYvNc— Arab News Pakistan (@arabnewspk) January 12, 2021
Saleem-uz-Zaman, president of the Qur’angi Association of Trade and Industry, said industries had borrowed money to keep afloat during the coronavirus pandemic and subsequent lockdowns imposed in March, “but now we can not run industries on loans any more.”
Abdul Hadi, president of the SITE industrial zone, said the government had first increased the rates of gas from Rs786 to Rs930 per million British thermal units (mmbtu) and then suspended gas supply altogether.
Pakistan has suffered from chronic energy supply problems for years, with regular power blackouts and gas outages caused by a mix of poorly maintained distribution networks, inefficient regulation and poor governance.
The country has significant natural gas reserves that can fill almost half its energy requirements but supply constraints have led to increasing demand for LNG imports.
Prime Minister Imran Khan’s critics say the natural gas companies are not solely responsible for the recent energy crisis, pointing to decisions made by his government which have discouraged the importing of LNG.
In October 2019, the Khan government announced it would renegotiate agreements for two liquefied natural gas (LNG) import terminals as part of a wider investigation into deals struck by the previous government.
The rapid adoption of LNG infrastructure made Pakistan one of the industry’s fastest-growing markets in Asia, sparking interest from the world’s major energy producers and traders.
“1,100mmbtu regasified liquefied natural gas is being imported but the industries of Karachi are not getting their due share,” Hadi from the SITE industrial zone said. “The gas to captive power should be restored and gas tariff should be reduced.”
Saeed Ahmed Larik, Deputy Managing Director at the Sui Southern Gas Company, told reporters the utility had informed the government about the shortage of gas. The utility supplies gas to 4,400 industrial consumers.
Natural gas makes up 50 percent of Pakistan’s primary energy mix. The local production of gas has been stagnant at 4,000mmcfd for the last 10 years as compared to the constrained demand of 6,000mmcfd and unconstrained demand of 8,000mmcfd.
