After three months of gas shutdown in winter, industries warn of massive layoffs

The News reported on Sunday that Sui Southern Gas Company Limited (SSGCL) handed gas closure notifications to enterprises in Karachi for over three months during the winter. The industries rejected the notices, stating that gas disruptions would result in significant layoffs and business closures.

The Karachi Chamber of Commerce and Industry (KCCI) and seven other industrial town organizations issued a joint statement on Saturday, stating, “The industries are in a state of shock after receiving SSGCL’s notices of gas closure from November 15, 2022, to February 28, 2023.”

KCCI stated that it had formed a committee on the gas issue in conjunction with the town associations, including SAI, KATI, LATI, FBATI, NKATI, SSHAI, and BQATI, which had previously brought the issue of gas supply to the attention of the government.

Since the government has made no particular arrangements to acquire RLNG for injection into the system, the gas closures cannot be deemed beneficial to the economy this year.

The committee stated that it expected the government to take the necessary steps to secure gas supply to the city’s businesses instead of total gas interruptions, which would result in a precipitous decrease in exports and revenue, the closure of industries, and layoffs.

The sectors stated that they had presented an alternative plan to a government-formed committee on gas concerns, along with proposals to address the impending winter gas shortage. They said the notices sent to the industries did not cover them.

According to KCCI, their committee proposed to the government that the gas supply be shut off for two days per week, every 12 hours, throughout the winter months.

It was stated that a proposal was made for gas load management on a rotational basis to guarantee that industrial activity was not fully halted and that conversations were also held to close 50 percent of captive power plants.

‘Utter contrast’

In addition, they had proposed closing down the captive power plants of the industries that received adequate power and electricity from Karachi-Electric.

It was also discussed that gas usage should be restricted for CPPs, while gas must be guaranteed for the operation of industrial boilers. In addition, additional energy conservation measures should be implemented, according to the joint statement.

“SSGC’s gas closure notices are also contradictory because it is not specified how the business will supply gas to export-oriented sectors throughout the winter, a key industry.”

The KCCI and seven affiliated industrial town groups demanded immediate intervention from Prime Minister Shehbaz Sharif and Chief Minister Sindh Murad Ali Shah in response to the SSGC’s gas reduction plan.

Bangladesh has prioritized industry by supplying 961 CFD, or 34% of the total gas supplied to industries, whereas Pakistan only supplies 721 mmcfd to the industrial sector.

KCCI reports that Karachi’s export industries contribute more than 54% of the nation’s exports, while its general industries meet more than 50% of the nation’s needs.

The joint statement demanded that the government ensure the smooth operation of the industries and save them from a crisis by providing them with a rational gas supply plan.

In addition, they asserted that the SSGC issued the gas closure notices with the government committee’s knowledge.