Natural gas is the biggest source of primary energy with a share of 48% in Pakistan’s energy mix. Pakistan can also boast of possessing one of the largest pipeline network in the world (nearly 150,000 kilometers) for gas distribution and transmission, servicing more than 8 million customers.
One of the key technical issues being faced by a utility company around the world is that of line losses or Unaccounted-for-Gas or UFG. In case of Pakistan, UFG is generally termed for more than 10% but it may go all the way to 60% in some areas. Let us take the example of SSGC and SNGPL – both the companies have numerous engineering feats in their name. They have successfully incorporated state-of-the-art technology in their operations and have adopted a refreshing customer-centric approach that can be compared to any top energy company in the world. This is just one side of the story. However, for many years, both SSGC and SNGPL have been plagued by UFG, which is termed as gap between total gas purchased and total gas accounted for as sale. UFG is a very serious issue since every 1% increase in UFG means that the Regulator or OGRA, in such case, takes away Rs. 1.2 billion from the gas companies’ financial profits as penalty, thus severely affecting their financial bottom-line.
The major contributing factor in UFG is theft of natural gas that makes up a whopping 51% of the UFG pie. Gas theft is a major menace since it causes an annual loss of Rs. 50 billion to the national exchequer. It is also a national issue and Prime Minister Imran Khan has recently directed for countrywide crackdown on gas thieves. Thus tightening the noose on the gas thieves is a proof that the Government and the gas utilities under it, are on the same page.
Although in the past, a legislation was promulgated to rein in gas theft, the efforts made by the gas companies to control gas theft could not make much inroads. Moreover, instead of paying the gas bills on time, a number of consumers in domestic, commercial and industrial sectors resorted to using the fuel illegally which is clear violation of Gas Sales Agreement. They bypassed meters, ran heavy generators using unauthorized connection, damaged transmission lines, tampered the gas pipelines and meters and yet get away with the crime scot free.
Then in 2016, National Assembly of Pakistan passed Gas (Theft and Recovery Act) that allows to impose heavy penalties on the offenders engaged in various types of gas theft with maximum punishment of 14 years and a penalty up to Rs. 10 crores. SSGC, facing trouble of rising UFG levels, was driven by the Act to take stringent measures against gas theft cases. In 2017, the Company’s Security Department was revamped as Security Services and Control Gas Theft Operations (SS & CGTO) Department. The Department was comprised of professional and motivated persons and established gas theft intelligence, security, prosecution and operations wings. In conjunction with SSGC Police that was established in 2015 and other law enforcement agencies including Sindh Rangers and FIA, the Department started making regular raids against domestic, commercial and industrial units.
Since July 2017, SS & CGTO Department has undertaken 127 intelligence based operations across Sindh and Balochistan by conducting the raids on those domestic, commercial and industrial units that were involved in blatant gas theft under the title “Operation Grift” campaign. Overall, the department has conducted around 1,370 raids as part of the ‘Operation Grift’. In May 2018, in the first such arrest was made, of a road side restauranteur in Karachi, which was arrested and sentenced for five years and fined Rs. 50,000. Since then, around 20 miscreants have been apprehended and sent to jail. In February this year, a CNG station owner was found using illegal gas connection and was sentenced to thirteen years and was fined Rs. 180 million. As a result of these operations, natural gas worth 1,315 MMCF (Rs. 755 million) has been saved to date. Few SSGC officials who collude with the miscreants have also not been spared.
SSGC’s efforts have been further boosted by the establishment of more than 35 Gas Utility Courts in Sindh and Balochistan, as defined in the Act, to take punitive action against the offenders and serve them punishment commensurate with the type of theft committed. The Act spurs a common citizen into playing a proactive role in prosecuting the wrong doers. Section 25 of Gas Act 2016 specifically states that if an incident of a bona fide theft is reported to the Company, the reporting individual, as per law, will be eligible to 5% of the recovered amount.
While on the ground, SSGC continues its relentless drive against gas thieves, the Company’s Corporate Communication Department is regularly running media campaigns in print, electronic social media and digital media publications about this menace. The aim is to mobilize the stakeholders about this crime against community so that they too stand with SSGC to combat it.
SSGC’s current mass media anti-gas theft campaign that began in March this year is primarily aimed at the rising tide of industrial theft. New television commercials have been developed and media planning has been done to ensure that message reaches more and more customers in the Company’s franchise areas throughout Sindh and Balochistan. The advertisements carry strong messages, warning the miscreants against unauthorized enhancement of gas loads and installation of suction booster in industrial units, both of which can land them in trouble.
To root out what is bad in the society is never easy. Team SSGC is, however, determined to counter gas theft and the inroads it has made during the last about one year is a manifestation of its steadfastness against this major misdemeanor. Gas theft is a crime against community and SSGC’s true success in this regard will be ensured with concerted effort from the government, general public and the media.
