Price hike to increase gas theft

Thursday, November 27, 2008

By Jawwad Rizvi

LAHORE: The recent hike in gas prices will further increase Unaccounted for Gas (UFG) simply called line losses of the gas companies as chances of gas theft will increase. The gas prices had registered an upwards trend during the last eight months. The new government had twice increased rates of natural gas. First raise in the gas price was made in the backdrop surging trend in international oil prices, while the recent hike was made after increase rupee-dollar parity. After first increase, the line losses of Sui Northern Gas Pipelines Ltd (SNGPL) increased by almost 2 per cent. According to an official of the company, line losses in the last quarter have crossed 8 per cent as compared to the corresponding period of last year. Due to increase in the line losses Oil and Gas Regulatory Authority (OGRA) had also imposed a penalty of Rs2.7 billion as the company UFG losses crossed the minimum bench mark of 6 per cent set by the authority.He said that there are contributors in UFG lose including the gas theft, leakages and measurement. However, gas theft contributes maximum in controlling leakages and company always continued efforts to stop leakages. On the other hand the measurement errors are also minimised, he added.A quantum increase in UFG loses were recorded after first increase in the gas prices, he said adding that the top management of the company had feared the tendency of gas theft increases after surge in gas prices by the government.He said that the top management of the company had issued strict instructions to the GMs of all eight regions to bring down the UFG loses intimating them any disciplinary action in case of failure to achieve the target.The electricity pilferage by ignorance of the previous government has created a monster which is now almost uncontrolled by any of the authority. Now the new government is also committing the same mistake in natural gas. Quantum increase in the prices of natural gas is attracting gas consumers to go for its theft. The electricity theft is visible and easily deducted by the power distribution companies while they also have support of the law to deduct the electricity supply.Contrary to this, to check natural gas theft is an uphill task. The people who theft gas laid down a parallel line from the main supply line with the involvement of companies officials. As the gas pipeline was the laid down underground and not visible to anyone. Thus, the gas companies can not take action without prior information. Big commercial and industry consumers are usually involved in gas theft as compared to the domestic consumers. Thus to take action against such people always remained the issue for gas companies.Only solution to bring down UFG losses would be that government reduces gas prices again by bringing down rupee dollar parity, said and official of ministry of petroleum and natural resources. He said that the crude oil price has registered a declining trend internationally, if the government brings down rupee-dollar parity to Rs60, equal to one US dollar then the prices of gas will be reduced.