Lucrative deal: Iraq offers long term deferred oil payment facility

Thursday, February 16th, 2012 3:00:16 by



[[IMAGE: PPL to launch exploratory venture in Iraq; government works on new refinery policy. DESIGN: FAIZAN DAWOOD]]

ISLAMABAD: 

With the power sector facing problems in the regular supply of furnace oil because of the circular debt Iraq has now offered Pakistan to provide oil on long term deferred payment facility.

While addressing a press conference here on Wednesday, Special Assistant to Prime Minister Dr Asim Hussain also said that Pakistan would move ahead on Iran-Pakistan (IP) gas pipeline project despite international resistance.

He said that Iraq had offered to provide oil on deferred payment on Wednesday and a delegation would go to Iraq to negotiate a deal.

“Oil refineries in Pakistan are designed to refine low sulphur oil and therefore an upgrade or new refineries will be needed to process Iraqi oil,” he said adding that the government is working on a new refinery policy.

He also said that Pakistan Petroleum Limited (PPL) was going to launch its exploratory operations in Iraq with an investment of 0 million.

At present, Pakistan is using 120 Centistokes (CST) sulphur oil to 160 CST oil that costs per ton more than 380 CST sulphur oil.

“Now we want to convert power plants to use 380 Centistokes (CST) sulphur oil and Hub Power Company (Hubco) has expressed willingness in this regard,” Hussain said that it will help save m to m a year.

“The government has also now agreed to purchase 200 mmcfd LNG from LNG developers to inject into the systems of SNGPL and SSGCL,” he said and confirmed that it would cause a hike in local gas prices due to taking weighted average.

He said that it was now the question of affordability and availability which the cabinet would have to decide that either government should go for costly LNG or wait for exploration of indigenous reserves to get gas at per mmbtu. In the LNG Policy 2011, government had given no guarantee to buy gas from LNG developers and they are supposed to arrange their own clients in power sector and industry.

“We need to give gas to fertilizer sector to boost economy and will have to end subsidy to sustain the economy,” he said. “The criteria to provide gas to the new schemes should be changed, otherwise Sui companies will financially collapse,” he also said.

He said that Petroleum Ministry was also working to review the gas pricing formula that assures 17 per cent guaranteed return on assets to Sui companies which consumers were paying. He said comments had been sought from stakeholders.

He said that there were two regulators including Oil and Gas Regulatory Authority (Ogra) and Explosive Department under two different ministries including cabinet division and Ministry of Industries to look into matters of safety of CNG cylinders.

“We are facing problems in ensuring safety due to this,” he said adding that issue will be resolved soon. He also said that consumers should get smart meters of gas if they are facing problems of bogus billing.

With regards to the delay in the implementation of the petroleum policy he said that with the consensus between provinces work on concessions was already underway.

The adviser also said that the government has decided to give contracts for the extraction of LPG from Kunnar Pasakhi Deep (KPD) field to avoid a loss of 150 million dollars. He said that the Oil and Gas Development Company Limited (OGDC) will be able to set up its own LPG plant at KPD by October this year.

Published in The Express Tribune, February 16th, 2012.



Islamabad News Sources -2

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Short URL: http://islamabad.newspakistan.pk/?p=19651

Posted by on Feb 16 2012. Filed under Latest News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

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Lucrative deal: Iraq offers long term deferred oil payment facility

Thursday, February 16th, 2012 3:00:15 by



[[IMAGE: PPL to launch exploratory venture in Iraq; government works on new refinery policy. DESIGN: FAIZAN DAWOOD]]

ISLAMABAD: 

With the power sector facing problems in the regular supply of furnace oil because of the circular debt Iraq has now offered Pakistan to provide oil on long term deferred payment facility.

While addressing a press conference here on Wednesday, Special Assistant to Prime Minister Dr Asim Hussain also said that Pakistan would move ahead on Iran-Pakistan (IP) gas pipeline project despite international resistance.

He said that Iraq had offered to provide oil on deferred payment on Wednesday and a delegation would go to Iraq to negotiate a deal.

“Oil refineries in Pakistan are designed to refine low sulphur oil and therefore an upgrade or new refineries will be needed to process Iraqi oil,” he said adding that the government is working on a new refinery policy.

He also said that Pakistan Petroleum Limited (PPL) was going to launch its exploratory operations in Iraq with an investment of 0 million.

At present, Pakistan is using 120 Centistokes (CST) sulphur oil to 160 CST oil that costs per ton more than 380 CST sulphur oil.

“Now we want to convert power plants to use 380 Centistokes (CST) sulphur oil and Hub Power Company (Hubco) has expressed willingness in this regard,” Hussain said that it will help save m to m a year.

“The government has also now agreed to purchase 200 mmcfd LNG from LNG developers to inject into the systems of SNGPL and SSGCL,” he said and confirmed that it would cause a hike in local gas prices due to taking weighted average.

He said that it was now the question of affordability and availability which the cabinet would have to decide that either government should go for costly LNG or wait for exploration of indigenous reserves to get gas at per mmbtu. In the LNG Policy 2011, government had given no guarantee to buy gas from LNG developers and they are supposed to arrange their own clients in power sector and industry.

“We need to give gas to fertilizer sector to boost economy and will have to end subsidy to sustain the economy,” he said. “The criteria to provide gas to the new schemes should be changed, otherwise Sui companies will financially collapse,” he also said.

He said that Petroleum Ministry was also working to review the gas pricing formula that assures 17 per cent guaranteed return on assets to Sui companies which consumers were paying. He said comments had been sought from stakeholders.

He said that there were two regulators including Oil and Gas Regulatory Authority (Ogra) and Explosive Department under two different ministries including cabinet division and Ministry of Industries to look into matters of safety of CNG cylinders.

“We are facing problems in ensuring safety due to this,” he said adding that issue will be resolved soon. He also said that consumers should get smart meters of gas if they are facing problems of bogus billing.

With regards to the delay in the implementation of the petroleum policy he said that with the consensus between provinces work on concessions was already underway.

The adviser also said that the government has decided to give contracts for the extraction of LPG from Kunnar Pasakhi Deep (KPD) field to avoid a loss of 150 million dollars. He said that the Oil and Gas Development Company Limited (OGDC) will be able to set up its own LPG plant at KPD by October this year.

Published in The Express Tribune, February 16th, 2012.



Islamabad News Sources -2

Tags: , , , , , , , ,

Short URL: http://islamabad.newspakistan.pk/?p=19650

Posted by on Feb 16 2012. Filed under Latest News. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry

Leave a Reply


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