Petroleum Minister Dr Asim Hussain said at a meeting in Islamabad on Tuesday, that the government might be forced to stop gas supply to CNG sector for at least five days a week, under a conservative estimate, and to go for a complete closure in the worst case situation.
As per the Petroleum Minister, up to 2.5 (BCFD) billion cubic feet of daily gas shortage was likely from November to January against the total demand of about 6.5BCFD. The gas shortfall this winter could be worse than the prevailing power shortfall for which major conservation measures must be taken.
The country could essentially be facing a threat of even – a more severe energy crisis from October this year, the government is reported to be discussing a proposal to impose a drastic gas cut to transport sector, penalize senior officials for failures and publicly criticize the alleged blackmailing tactics adopted by the industrial sector.
RS 5 petroleum levy to be imposed on CNG:
The Ministry of Petroleum has decided on imposing a petroleum levy (PL) of Rs 5 per kilogram on Compressed Natural Gas (CNG), which kept an edge over other competing fuels for the last couple of years.
The imposition of this levy could very well generate RS 12 billion in additional revenue for the cash-starved economy. While this decision has arrived just after the RS 6 increase in CNG prices, few sources indicate that this decision has been made to lower the profit of CNG pump owners as the CNG sector cannot be promoted any more due to the country’s depleting gas reservoirs.
Meanwhile, the CNG association has rejected the proposed petroleum levy on CNG and it is pertinent to mention that that it has been estimated that Petroleum Levy would generate Rs 110 billion revenue and Gas Development Surcharge worth Rs 35 billion in the next year’s budget.