After several months of forced closure due to gas curtailment in 2011 and first two months of 2012, supply of gas to fertiliser plants on SNGPL network was restored on March 3 excluding Dawood Hercules Fertilisers Limited situated at Sheikhpura, whose gas supply remained suspended.
The SNGPL based plants that include Pakarab, Engro Enven, Agritech and Dawood Hercules Fertilisers, with an accumulative urea production capacity of 2.2 million tons have been facing huge gas curtailments throughout 2011 and since the beginning of 2012. Besides, the 62 days of shutdown during 2012 to date, Dawood Hercules Fertilisers was shut down for 192 days, Engro Enven for 190 days, Agritech for 173 days and Pakarab for 144 days during 2011.
In the absence of gas supply which is a raw material for the fertilisers, industry could only produce 4.9 million tons of urea against an installed capacity of 6.9 million tons in 2011. This record shortfall in the production of urea forced the government to spend nearly US $800 million in precious foreign exchange for import of costly urea and further Rs 54 billon as subsidy on imported urea to keep it at the price of locally produced urea.
While welcoming the government's decision to resume gas supply to Pakarab, Agritech and Engro Enven plants, the CEO Dawood Hercules Fertiliser, Rashid Lone here on Monday regretted that DH Fertilisers was facing discriminatory treatment in the matter of gas supply.
He pointed out that DH Fertilisers remained the only fertiliser factory on the SNGPL network to which gas supply had not been restored. He highlighted the fact that the gas supply to the fertiliser plants was regulated by the ECC approved Gas Load Management Policy 2005 which gave top priority of gas supply to fertiliser plants after meeting the requirements of domestic consumers. Additionally, all fertiliser manufacturers had signed Gas Sales/Purchase Agreement (GSPA) with SNGPL for supply of gas to their plants, he maintained.
In the presence of these regulatory and contractual provisions there should not be any preferential treatment for any specific industry or business concern while planning the gas distribution in the country, he added. He hoped that gas supply would be restored to all the fertiliser plants in judicious manner without discriminating or unjustly favouring one party over the other.