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Power woes: Govt plans LNG-based power plants in Punjab
By Shahbaz Rana
Published: January 3, 2015
ISLAMABAD:
In another attempt to address power woes, the federal government has planned to set up 3,600 megawatts (MW) Liquefied Natural Gas (LNG)-based power plants in Punjab.
The plants are planned as part of the government’s long-term energy policy. Additionally, it wants to add LNG-based power plants of 3,600MW capacity in the next two years at Haveli Bahadur Jang, Balloki and Bhakki near Shahdara, Lahore.
This proposal was discussed at a meeting of the sub-committee of the cabinet committee on energy that sat down on Friday chaired by Finance Minister Ishaq Dar. The panel is to meet again on Monday to finalise its recommendations for Prime Minister Nawaz Sharif.
The move is aimed at minimising energy shortages in Punjab. After the 18th Amendment, the provinces have priority over their own resources, which has created a shortfall for gas-deficient Punjab.
Chinese investors have already shown an interest to set up LNG plants and held meetings with Chief Minister Shahbaz Sharif.
In the last meeting of the Cabinet Committee on Energy, the premier had directed the concerned government ministries to finalise a plan for long-term strategy for LNG-based power generation. For short-term, he had also sought specific proposals for the next meeting aimed at improving power supply in coming summer.
The government had planned to use LNG to lessen its heavy reliance on furnace oil. It has already decided that it would not pursue a weighted average gas price policy after LNG imports and the use of LNG in power plants would protect consumers from the increase in prices. The government has decided to provide the natural gas to the most efficient power plants.
Gas distribution companies will lay transmission lines of 42-inch diameter to transport imported LNG from Karachi to Lahore. The government was making arrangements to import 2 billion cubic feet of LNG per day in the next two years to meet energy needs.
The sub-committee also held deliberations on the proposed two-pronged short-term policy which envisages an immediate measure, generation of 1,000MW electricity based on well-head gas in jurisdictions of Hyderabad and Sukkur power distribution companies. Secondly, there was also a plan for another 1,000MW power generation package, based on local gas supply. Bids for these projects have already been invited till January 15.
Altogether, the short- and long-term measures would add up to 5,600MW of electricity to the national grid, according to a handout issued by the finance ministry.
Finance Minister Ishaq Dar said that along with power generation, proper transmission facilities should also be ensured. It was the foremost requirement for the success of both short and long term measures, he added. The minister directed re-convening of the sub-committee on Monday to finalise its deliberations and formulation of recommendations for submission to the prime minister at the next meeting of cabinet committee on energy.
Apart from these two short- and long-term projects, there are a number of coal, wind and solar-based energy projects which are to be undertaken as part of the China-Pakistan Energy Corridor, said the ministry.
Published in The Express Tribune, January 3rd, 2015.
Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.
By Shahbaz Rana
Published: January 3, 2015
ISLAMABAD:
In another attempt to address power woes, the federal government has planned to set up 3,600 megawatts (MW) Liquefied Natural Gas (LNG)-based power plants in Punjab.
The plants are planned as part of the government’s long-term energy policy. Additionally, it wants to add LNG-based power plants of 3,600MW capacity in the next two years at Haveli Bahadur Jang, Balloki and Bhakki near Shahdara, Lahore.
This proposal was discussed at a meeting of the sub-committee of the cabinet committee on energy that sat down on Friday chaired by Finance Minister Ishaq Dar. The panel is to meet again on Monday to finalise its recommendations for Prime Minister Nawaz Sharif.
The move is aimed at minimising energy shortages in Punjab. After the 18th Amendment, the provinces have priority over their own resources, which has created a shortfall for gas-deficient Punjab.
Chinese investors have already shown an interest to set up LNG plants and held meetings with Chief Minister Shahbaz Sharif.
In the last meeting of the Cabinet Committee on Energy, the premier had directed the concerned government ministries to finalise a plan for long-term strategy for LNG-based power generation. For short-term, he had also sought specific proposals for the next meeting aimed at improving power supply in coming summer.
The government had planned to use LNG to lessen its heavy reliance on furnace oil. It has already decided that it would not pursue a weighted average gas price policy after LNG imports and the use of LNG in power plants would protect consumers from the increase in prices. The government has decided to provide the natural gas to the most efficient power plants.
Gas distribution companies will lay transmission lines of 42-inch diameter to transport imported LNG from Karachi to Lahore. The government was making arrangements to import 2 billion cubic feet of LNG per day in the next two years to meet energy needs.
The sub-committee also held deliberations on the proposed two-pronged short-term policy which envisages an immediate measure, generation of 1,000MW electricity based on well-head gas in jurisdictions of Hyderabad and Sukkur power distribution companies. Secondly, there was also a plan for another 1,000MW power generation package, based on local gas supply. Bids for these projects have already been invited till January 15.
Altogether, the short- and long-term measures would add up to 5,600MW of electricity to the national grid, according to a handout issued by the finance ministry.
Finance Minister Ishaq Dar said that along with power generation, proper transmission facilities should also be ensured. It was the foremost requirement for the success of both short and long term measures, he added. The minister directed re-convening of the sub-committee on Monday to finalise its deliberations and formulation of recommendations for submission to the prime minister at the next meeting of cabinet committee on energy.
Apart from these two short- and long-term projects, there are a number of coal, wind and solar-based energy projects which are to be undertaken as part of the China-Pakistan Energy Corridor, said the ministry.
Published in The Express Tribune, January 3rd, 2015.
Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.
