PTBP Web Desk

The Special Investment Facilitation Council (SIFC) has issued a directive to resolve the long-standing impasse between Jamshoro Joint Venture Limited (JJVL) and Sui Southern Gas Company Limited (SSGCL). Both entities have been instructed to finalize an agreement by January 15, 2025, to resume gas supply to the idle JJVL plant, which has been causing significant foreign exchange losses for the country.

In a Working Group (WG) meeting held on October 1, 2024, the Petroleum Division was tasked with ensuring a commercially beneficial agreement for both SSGCL and JJVL. However, despite multiple discussions, a consensus has yet to be reached. The Petroleum Division emphasized that any decision regarding the resumption of gas supply to JJVL must address the clearance of outstanding dues.

The closure of the JJVL plant has resulted in an annual loss of approximately $108 million in foreign exchange. This substantial economic setback has heightened the urgency to resolve the matter. Although the plant remains operationally ready, it has been lying dormant due to the disconnection of its gas supply. The SIFC’s Executive Committee (EC) stressed the importance of immediate action to mitigate these losses.

The SIFC meeting outlined specific measures to be undertaken by both parties:

1. Agreement Finalization by January 2025: The agreement, including a mutually agreed revenue-sharing percentage, must be approved by the SSGC Board by the specified deadline. Gas supply will resume promptly once the agreement is signed.
2. Revenue Sharing Formula Compliance: The resumption of the JJVL plant will adhere to the Revenue Sharing Formula, which has already been endorsed by the Supreme Court of Pakistan. This formula will serve as a benchmark for the agreement.
3. Clearance of Outstanding Dues: JJVL is required to clear all pending undisputed dues payable to SSGC before gas supply can be resumed.
4. FIA Enquiry on JJVL: The Federal Investigation Agency (FIA) has been instructed to prioritize the ongoing enquiry related to JJVL and submit a progress report by January 31, 2025.
5. Compliance Monitoring: The finalized agreement and its adherence will be presented to the Implementation Committee of the SIFC (IC-SIFC) and subsequently to the EC-SIFC for information and endorsement.

The prolonged closure of the JJVL plant highlights the critical need for collaboration and resolution between JJVL and SSGCL. The economic implications, coupled with the potential to boost national energy production, underline the significance of this agreement. Stakeholders are urged to prioritize the national interest and work towards a mutually beneficial solution.