KARACHI: The Sindh High Court has dismissed a set of pleas filed against the Sui Southern Gas Company (SSGC) for disconnecting the supply of natural gas to non-export industries.

A single-judge bench headed by Justice Adnan Iqbal Chaudhry observed that the Dec 10, 2021 notice issued by SSGC for gas closure did not violate the gas load management plan for winter 2021-22.

Over 35 firms had filed suits and their lawyers submitted that plaintiffs were leading general/non-export industries based in Karachi and other parts of Sindh. They challenged the notice of SSGC for complete closure of gas supply to all general industries (non-export including captive power units) from Dec 11, till further notice and also made reliance on Article 158 by arguing that the Sindh was the top gas producing province.

Some of the plaintiffs also questioned the priority order as last revised by federal ministry of petroleum in 2018 by keeping the general industries at No. 3 in the priority list.

After hearing the lawyers for the plaintiffs, counsel for defendants and a federal law officer, the bench dismissed all the suits and in its order stated that the SSGC experienced 246mmcfd and 276mmcfd shortage in the months of December and January.

“Therefore, the argument of the plaintiffs that there is sufficient gas in SSGC’s system to satisfy the demand of domestic consumers is contradicted by the data of demand and supply shown to the court,” it added.

The order further stated that the lawyer for defendants also pointed that if there was sufficient gas in the system, there was no reason for the SSGC to withhold the same from the general industrial (non-export) sector, which was giving a higher tariff, a far more lucrative category of consumers than the domestic consumers.

Referring to a contention of plaintiffs that a complete gas notice was contrary to gas load management plan, the bench observed that even if a clause of the gas load management plan for winter was to relax the condition in the gas policy that no gas would be supplied to the general industrial sector from December to February, the clause was nonetheless subject to the priority order of gas supply laid down in the gas policy.

“Admittedly, under that priority order, the General Industrial sector (non-export) is at priority No. 3, and domestic and commercial consumers are at priority No.1. SSGC’s gas-closure notice dated 10-12-2021 clearly states that gas closure for the General Industrial (non-export) sector during that winter season is necessitated to divert gas to domestic consumers who are at priority No.1, and whose demand increases during the winter season, especially those in Balochistan,” it added.

About Article 158 of the Constitution that gave the provinces precedence in which well-heads of natural gas were situated in meeting their own requirements of gas, the bench said that it was with the aim of addressing an issue between such provinces and the federal government over the use of gas from a well-head.

It further said that it was the prerogative of a provincial government and did not give actionable cause to a person other than the provincial government concerned to invoke the same.

“It may well be that a provincial government decides not to invoke that prerogative for political considerations or to maintain unity of the federation, or barters that prerogative with another province or the federation for another resource keeping in view the overall requirements of the province. Since the province of Sindh is not a party to these suits to state otherwise, I do not delve in to examine the effect of Article 172(3) of the Constitution,” it concluded.

Published in Dawn, March 6th, 2022