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Fertiliser sector welcomes govt’s decision to ensure dedicated gas supply

Fertiliser Manufacturers of Pakistan Advisory Council (FMPAC), a representative body of the fertiliser companies has appreciated the government’s intention to ensure dedicated gas supply to the fertiliser plants on the Sui Northern Gas Pipelines Limited (SNGPL) network by allowing them to buy gas directly from oil producing companies, a statement said on Saturday.

The economic coordination committee (ECC) of the cabinet in its recent meeting has passed a summary that will allow the SNGPL-based fertiliser plants to buy gas directly from wellhead in order to reduce the burden from gas distribution companies and to ensure that they get gas without further curtailment, it said.

Shahab Khawaja, executive director of Fertilizer Manufacturers of Pakistan Advisory Council appreciated the ECC approval and appealed President Asif Ali Zardari, Prime Minister Raja Pervaiz Ashraf and adviser to the prime minister on petroleum and natural resources Dr Asim Hussain to immediately restore gas supply to SNGPL-based fertiliser plants, which are on the verge of collapse.

Showing its support for infrastructure development cess tax, he said FMPAC also supported the government’s decision to impose cess on gas usage for all sectors of the economy, especially, the fertiliser plants as a necessary tool to develop long-term solution to the energy crisis in the country.

Around 200 industrial units went to courts and obtained stay orders against imposition of cess, he said, adding that the fertiliser industry is paying cess and would continue to do so in the larger interest of the economy.

Khawaja said that SNGPL-based fertiliser plants are on the verge of closure as out of first seven months of 2012, these plants received gas for only two months.

If the government resumes gas supply to SNGPL-based fertiliser plant, a substantial reduction in the domestic urea prices could be observed, which would hugely benefit the poor farmers and ensure timely and proper usage of urea for better crop production, he said.

“Farmers are facing Rs53 billion of burden every year due to high urea prices in the country,” he said, adding that natural gas is the only raw material for the fertiliser plants, while other sectors used it for generating cheap electricity, hence, the government should give priority to the fertiliser sector as it supported the country’s agriculture sector and ensures food security in the country.

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