Panic gripped Karachi on Wednesday evening as numerous fuel stations were forced to shut down following a surge in demand sparked by rumors of a fuel supply suspension.
(more…)Category: Energy
You can go through stories related to energy. The stories are about changes in petroleum prices and updates on energy sector of Pakistan and world.
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Oil sales fall by 10% on slow economic activity
KARACHI: The domestic oil sales have declined by 10 percent during first seven months (July – January) 2019/2020 owing to slow economic activity.
Analysts at Topline Securities on Tuesday said that the oil sales slipped to 10,139,000 tons during first seven months of the current fiscal year showing decline of 10 percent.
The oil consumption in January 2020 fell by 13 percent year on year, where drop in sales was largely driven by 40 percent lower furnace oil sales due to government policy of moving away from FO-based power generation and 11 percent yoy decline in high speed diesel volumes amidst slow economic activity, particularly in the agriculture space.
However, on a sequential basis, oil sales witnessed limited decline of 2 percent month on month, supported by 88 percent MoM higher furnace oil offtake given government allowing partial resumption of FO-based power plants to support the local refineries and possible exports by Byco Petroleum.
High Speed Diesel sales were down by 13 percent Month on Month in January 2020, while motor spirit volumes declined by five percent MoM.
Pakistan State Oil sales declined by 16 percent YoY and 10 percent MoM in January 2020, however, during first seven months of current fiscal year sales remain 6 percent YoY higher.
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Petroleum prices kept unchanged
ISLAMABAD: The government has decided to keep the prices of petroleum products unchanged for the month of February 2020.
A statement said on Friday that the government decided to keep POL prices at the level of prices applied for January 2020.
For the month of January 2020 the prices were increased as:
The price of kerosene (SKO) has been increased by Rs3.10 per liter to Rs99.45 to from Rs96.35.
The price of petrol has been increased by Rs2.61 per liter to Rs116.60 from Rs113.99.
The rate of High Speed Diesel (HSD) has been increased by Rs2.25 per liter to Rs127.26 from Rs125.01.
The price of Light Diesel Oil (LDO) has been increased by Rs2.08 to Rs84.51 from Rs82.43.
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Revised gas price proposal to hit fertilizer industry
ISLAMABAD: In response to the recommendation by OGRA dated December 11, 2019 the Ministry of Petroleum has worked out certain revisions in the sector wise gas prices where it has recommended to increase fertilizers feed gas price by 5 percent while fuel gas price to be linked with RLNG prices currently at Rs1,672/MMBTU.
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OGDCL announces gas discovery in Sindh
KARACHI: Oil and Gas Development Company Limited (OGDCL) on Friday announced discovery of gas in the exploratory well located in Khairpur Sindh.
In an information shared with Pakistan Stock Exchange (PSX), the company announced that the joint venture of Ranipur Block comprising OGDCL as operator (95 percent), Government Holdings Private Limited (GHPL) (2.5 percent and Sindh Energy Holding Company (Private) Limited (SEHCL) (2.5 percent had discovered gas and condensate in the exploratory well Metlo 01, which is located in District Khairpur, Sindh Province.
The OGDCL said that the Metlo-1 was spud on November 17, 2019 and reach a depth of 1504 meters inside Upper Goru Formation. Based on wireline logs, drill stem test (DST) was conducted in Ranikot Formation and Sui Main Limestone.
The well has tested 1.85 million cubit feet per day of gas, 6 barrels per day of condensate and 38 barrels of water through 32/64” choke at well head flowing pressure of 285 pounds per square inch (Psi) from lower Ranikot Formation.
The discovery of Metlo-1 is the result of aggressive exploration strategy adopted by the company. “This discovery will add to the hydrocarbons reserves of OGDCL, GHPL, SEHCL and of the country and will contribute in reducing the gap between supply and demand of oil and gas in the country through the exploitation of indigenous resources.
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ECC constitutes price negotiation committee for TAPI gas pipeline project
ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet on Wednesday approved the constitution of Price Negotiation Committee (PNC) for TAPI(Turkmenistan-Afghanistan-Pakistan-India) Gas pipeline project.
Adviser to the Prime Minister on Finance, Dr. Abdul Hafeez Shaikh chaired the meeting of the Cabinet here at the Cabinet Division.
The PNC shall negotiate the price with Turkmen gas. The Committee shall consist of the following members; Secretary, Ministry of Energy (Petroleum Division) as chairman. Secretary Finance or his nominee, Joint Secretary, Ministry of Energy (Power Division), Director General (Gas)/ Director (Gas) and Managing Director, SSGCL as members.
The ECC approved the Technical Supplementary Grant of Rs 1.00 billion under demand No.04-Cabinet Division for establishment of Pakistan Tourism Development Endowment Fund under Public account.
The Chair directed Pakistan Tourism Development Corporation to come up with their tourism development and soft image promotion plan in the next meeting.
The ECC also granted approval of allocation of Gas from PGNiG’s RIZQ Gas Field to M/S SSGCL. It was briefed to the ECC that currently 2 wells namely Rizq-1 and Rizq -2 are producing 16 MMFCD gas from Rizq gas field, which are allocated to M/s SSGCL, whereas Rizq -3 which is under drilling, is expected to add another 9 to 10 MMCFD gas to the existing production. Upon completion of this well, the cumulative gas production from this gas field is expected to raise upto 25 MMCFD. The price of the gas shall be according to the applicable Petroleum Policy.
On the Demand moved by the Ministry of Industries and Production for Rs 3.02 billion for the payment of outstanding dues of SSGC Private Limited by Pakistan Steel Mills on account of gas bills, the ECC directed to constitute a three-member Committee under the Chairmanship of Secretary Finance to find out a feasible solution for the issue so that the already allocated budget may not be exceeded and the liabilities of both SSGC and PSM are duly settled.
ECC directed Ministry of Finance to explore the possibilities for improving the liquidity position of Pakistan State Oil as exchange losses of around Rs 28 billion have incurred on FE-25 loans by PSO.
The loans were acquired under the instructions of Ministry of Finance for financing of import operations of PSO.
Finance Ministry assured the ECC of utilization of possible all funding options in the ongoing financial year and any deficiency in the funds shall be entertained in the upcoming budget.
ECC granted extension of Government of Pakistan guarantee against credit facility of National Bank of Pakistan amounting to Rs5 billion in favor of Utility Stores Corporation of Pakistan.
On the request of the Ministry of Water Resources ECC granted approval to WAPDA to raise loan for the settlement of the Financial Facility amounting to Rs17.500 billion with one-year tenure and GoP guarantee.
Clearance under Prudential Regulations R-4(clause 1a and 2) from the State Bank of Pakistan to disburse the facility initially against a letter of comfort was also granted.
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POL prices increased up to Rs3.10/liter
ISLAMABAD: The government has increased the prices of petroleum products (POL) up to Rs3.10 per liter effective from January 01, 2020.
In a notification issued on Tuesday, the government decided to increase the prices of petroleum products as per recommended by Oil and Gas Regulatory Authority (OGRA).
Following are the new POL prices:
The price of kerosene (SKO) has been increased by Rs3.10 per liter to Rs99.45 to from Rs96.35.
The price of petrol has been increased by Rs2.61 per liter to Rs116.60 from Rs113.99.
The rate of High Speed Diesel (HSD) has been increased by Rs2.25 per liter to Rs127.26 from Rs125.01.
The price of Light Diesel Oil (LDO) has been increased by Rs2.08 to Rs84.51 from Rs82.43.
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PPL announces major discoveries of hydrocarbons in Sindh, Balochistan
KARACHI: Pakistan Petroleum Limited (PPL) has announced major discoveries of hydrocarbons in Sindh and Blochistan, according to notifications received by Pakistan Stock Exchange (PSX) on Monday.
In the first notice, the PPL disclosed a hydrocarbon discovery in exploratory well, Bitro-I in Latif Block located in Kharipur District, Sindh, by the joint venture partners of the Latif Exploratory License, namely the company which holds a 33.30 percent working interest there in, ENI Pakistan (M) Limited which holds a 33.30 percent working interest there in, and United Energy Pakistan Limited, which holds a 33.40 percent working interest there in and is also the operator of the Block.
The PPL said that the well was spud on October 6, 2019 to test the hydrocarbon potential of B and Intra B sands of the Lower Goru Formation, as primary and secondary objectives, respectively. The well was successfully drilled to a depth of 11,854 ft. Based on the wireline logs and the drilling results, a Modular Dynamics Testing was done against the promising zone in the B and Intra B sands.
Upon the completion of the well, B sand zone was perforated, which flowed 28.6 million standard cubic feet per day of gas with 152 barrels per day (condensed) water at a flowing well head pressure of 3,116 pounds per square inch at 44/64” choke size.
In another notice, the PPLC disclosed that the company had made a hydrocarbon discovery in the first exploratory well, Margand X-I in Margand Block, Blochistan, that is operated by the company which holds 100 percent working interest there in.
The well was spud on June 30, 2019 to a measured dept of 4,500 meters inside Chiltan Limestone. Based on the wireline logs, Modular Dynamics Testing was done which proved the presence of hydrocarbons.
Accordingly, a Drill Stem Test was done in the Chiltan Limestone, during which the well flowed a maximum 10.7 million cubic feet per day of gas at 64/64 inches choke size at a flowing well head pressure of around 516 pounds per square inch with 132 barrels per day liquid. The nature of the liquid is being investigated. However, the well has the potential to flow at higher rates after an acid stimulation job.
The company said that it was the first gas discovery in the Kalat Plateau and it had opened a new sub-basin for further hydrocarbon exploration.
The discovery is the result of Company’s aggressive strategy of exploration of the frontier basins in order to open new avenues for hydrocarbons exploration and production in the province of Balochistan.
The discovery will add to the company’s hydrocarbon reserves and will contribute in reducing the gap between the supply and demand of oil and gas in the country through exploitation of indigenous resources.
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K-Electric warns of crisis on non-payment of dues by Sindh departments
KARACHI: K-Electric – the power generation and distribution company – has demanded the Sindh government to pay the dues on urgent basis as non-payment will result into potential crisis for Karachi city.
In a letter to Sindh Chief Minister Syed Murad Ali Shah the power utility requested for support in expediting the release of outstanding dues of different department of the provincial government.
The K-Electric said it was facing severe cashflow issues due to the non-payment of dues by the government of Sindh. The company is working tirelessly to manage its routine operations and maintainance along with the purchase of power for the smooth functioning of the operations and to supply safe and reliable power to Karachi and its adjoining area.
“However, this has been communicated to your office time and again that with large amount pending in the form of receivable from the government departments, KE is facing severe constraints in running its day to day operations and ensuring seamless supply of power to the city.”
The power utility said that its receivable from different departments of the Sindh government had increased to Rs19.2 billion, of which Rs4.5 billion had been reconciled.
In addition, Rs33.09 billion is also receivable on account of KW&SB out of which Rs28.5 billion in dues have been fully reconciled.
In its summary to the Supreme Court of Pakistan, the Sindh government agreed to devise a payment plan for the reconciled amount, which was also made part of the apex court’s order.
However, there have been notable delays in the payment against the mentioned reconciled amount and a payment plan is still awaited.
As a result, K-Electric’s borrowing has increased substantially, and the situation is not sustainable for the company. Moreover, the capacity of banks to finance KE has been exhausted, inadvertently effecting KE’s working capital and long-term expansion plan.
The KE said that it was not a defaulter of current payments to any of its fuel suppliers since 2012, despite the cashflow situation. However, to be able to continue to make payments to the suppliers and ensure smooth operations, it is essential that the release of outstanding dues is expedited.
“… the non-payment of these dues will result into potential crisis for the city and the sustainability of KE’s operations,” it said.
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Customs intelligence recovers Rs221.7 million from OGDCL for claiming wrong exemption
KARACHI: Directorate of Customs Intelligence and Investigation, Karachi has recovered Rs221.7 million from Oil and Gas Development Company Limited (OGDCL) against avoiding payment of duty and taxes on import of seamless pipes.
Officials at the directorate on Wednesday said that the oil and development company imported seamless pipes from China and got cleared through MCC Appraisement East, Karachi while availing exemption under SRO 678(I)/2004.
“The GD was assessed and cleared by the collectorate under claimed exemption on customs duty at five percent and additional customs duty at four percent total amounting to Rs71.77 million against total assessed value of Rs797.53 million,” according to an official note sent to Federal Board of Revenue (FBR) Headquarters.
It said that the scrutiny of GD revealed that the exemption was wrongly claimed as it was not admissible on the goods being locally manufactured.
While realizing the factual position the representatives of OGDCL submitted pay orders amounting Rs221.71 million, which was drawn on National Bank of Pakistan (NBP).
The payment of differential amount proved that the OGDCL had wrongly claimed exemption under the SRO 678(I)/2004 which resulted into loss of government revenue. The paid amount included Rs39.87 million as customs duty, Rs154.56 million as sales tax and Rs27.27 million as additional sales tax.
The pay orders submitted by the company were sent to the clearance collectorate for deposit in the government treasury after assessment of the GD so that consignment may be de-blocked.
The directorate said that the amount was deposited in the government treasury. However, role of customs officers/officials is being ascertained in the matter.
Director I&I Irfan Javed praised the extraordinary efforts of Adnan Rafiq, Deputy Director, in detection of the evasion.