The Petroleum Ministry is not prepared to allocate gas for the Prime Minister's 'desired' rental power plant of General Electric (GE) Energy, of USA, to be installed in Sheikhupura by the Water and Power Development Authority (Wapda), official sources told Business Recorder.
On June 14, Prime Minister Shaukat Aziz had instructed Wapda to acquire 100 MW power plant from GE Energy on rental basis and install it at the existing site of 150 MW rental power station at Sheikhpura.
GE Energy submitted a proposal for installation of an additional 107 MW power plant within three months, which is being processed. In the light of Prime Minister's directive of June 14 and subsequent proposal of G.E. Energy, Wapda had approached the Petroleum Ministry for allocation of 28 mmcfd gas to run the plant, but according to the Ministry Sui Northern Gas Pipeline Limited (SNGPL) has refused to implement the decision, sources said.
SNGPL had been asked to provide gas from October 2007 to March 2010 on 12-month basis--a clear violation of existing rules--to ensure optimum utilisation of power plant at high load factor.
"It shall not be possible for SNGPL to meet the requirements of 28 mmcfd for 100 MW third rental power plant at Sheikhupura, neither round the year nor on 9 months basis because of new IPPs and Wapda's other rental power plant as well as increase in domestic, commercial and industrial gas connections," sources quoted Zaheer Alam, Director, Gas, Ministry of Petroleum and Natural Resources, as saying in a letter to Wapda's Member Power, Fazal Ahmad Khan.
However, SNGPL has expressed its willingness to provide gas at upstream of Multan/Muzaffargarh, out of gas quantity being supplied to Kapco on nine months basis, up to commissioning of new IPPs, sources added.
Wapda, in its letter, had asked the Petroleum Ministry to allocate 28 mmcfd gas on top priority basis from January 2008 to March 2010 on whole year basis over and above the allocation for the existing plants, arguing that the additional generation is required to reduce the gap between demand and supply in compliance with the Prime Minister's instructions.
Sources in Private Power Infrastructure Board (PPIB) said that Minister for Water and Power, Liaquat Ali Jatoi, was informed at a recent meeting that without allocation of gas, the proposal of 100 MW rental power plant could not materialise.
They said that the Ministry of Water and Power would raise the issue with the Ministry of Petroleum and Natural Resources for allocation of gas for the Prime Minister's desired power plant. It is not clear whether the proposal to acquire 100 MW rental power plant without bidding, has been placed before the Public Procurement Regulatory Authority (PPRA) or not.