Diversion of Rousch gas to industry: Ministry reluctant to implement Prime Minister's directive

The Ministry of Water and Power is reportedly reluctant to implement the Prime Minister's directive regarding diversion of 85 MMCFD gas dedicated for 412 MW M/s Rousch Power Company to export oriented industry especially Punjab-based textile sector, sources close to Minister for Water and Power told Business Recorder.
Punjab-based textile sector held meetings with Finance Minister, Senator Ishaq Dar and Chief Minister Punjab Mian Shahbaz Sharif who assured them that the industry will not be allowed to suffer due to shortage of gas. Minister for Water and Power, Khawaja Asif has been one of the key critics of diverting gas to the textile sector as he believes that this sector earns more on cheap gas for power generation than its export products.
The sources said Prime Minister's directive is not enough to implement a policy decision and for this purpose either the Ministry of Water and Power or Ministry of Petroleum and Natural Resources has to seek formal approval from the Economic Co-ordination Committee (ECC) of the Cabinet.
Presently, textile sector in Punjab is being supplied the required quantity of gas diverted from the CNG and fertilizer sectors. However, as winter intensifies, gas from M/s Rousch Power Company will be diverted to textile sector. Minister for Commerce, Engineer Khurram Dastgir repeatedly urged the government to ensure gas supply to export oriented industry so that the country could benefit from GSP plus status granted by the EU. Power sector analysts argue that if the government diverts gas from M/s Rousch Power Plant to the textile sector, consumers will have to pay Rs 600 million per month in winter for at least two months. M/s Rousch Power Plant is top in terms of efficiency and provides electricity at Rs 4.5 per unit to the NTDC.
The sources revealed that the November 24, 2014 decision regarding diversion of 85 MMCFD of M/s Rousch to the textile sector was taken at a high level meeting. According to sources, last year, similar directives were issued to the Water and Power Minister but the National Power Control Centre (NPCC) refused to implement the directive saying that dispatch order for the most efficient power plant cannot be zeroed without formal approval of the ECC.
Keeping in view the NPCC's objections, Water and Power Ministry sought the ECC's approval prior to diverting gas from M/s Rousch to the textile sector. According to the Office Memorandum, Prime Minister has directed that the gas allocation mechanism adopted last year be replicated in toto in the current year to ensure balance of supply position between energy sector, industry and domestic consumers/commercial consumers.
When contacted, Chairman All Pakistan Textile Mills Association (APTMA), S M Tanvir confirmed that textile sector in Punjab is being supplied sufficient gas and Chief Minister Punjab has assured that textile industry will not be allowed to shut down. One of the power sector experts told this scribe that as and when the National Transmission and Dispatch Company brings down dispatch to zero, gas will automatically be freed for the power sector. Under the power purchase agreements, the government could seek 10 per cent closure of power plant at zero capacity payment.