Saturday, 6 December 2014

Dar urged to help resolve gas supply issue of TSML

President of Karachi Chamber of Commerce and Industry's (KCCI), Iftikhar Ahmed Vohra, has urged the federal finance minister to help resolve the lingering issue of gas supply to Tuwairqi Steel Mills Limited (TSML) in the forthcoming meeting of Economic Co-ordination Committee.

In a letter sent to the Federal Finance Minister Ishaq Dar, the KCCI chief said that a delegation of TSML headed by its country-head, Zaigham Adil Rizvi and included the resident director of POSCO Pakistan office, Yoo Young-Ho, which called on him had sought KCCI's assistance in getting restored gas supply to the TSML's Sindh plant, at a rate of Rs 123/mmbtu as was committed by the government at the time of signing MoU.

TSML delegation, he added, apprised him that the project of Tuwairqi Steel Mills Limited (TSML), a joint venture of Al-Tuwairqi Holding of Saudi Arabia and POSCO of South Korea, is being set up at Port Qasim Karachi and on completion it would be the largest steel complex in Pakistan.

Phase-1 of the project, having a capacity of 1.28 million tons per annum, was completed with Japanese technology in 2013, involving an investment of US $340 million. However, the TSML's plant after carrying out test runs of 100 per cent capacity successfully is lying shut since September 2013 as its operation had became commercially unviable due to the high tariff of natural gas.

The delegation has also informed the KCCI that the project was supposed to ensure a host of econometric and collateral benefits, including creation of jobs for another 5,000 people. The KCCI said that although the plant is in a 'shutdown mode' for last one year, not a single employee of TSML has been laid off which clearly indicated keen desire of the management of the Mills to restart operations of the plant.

He apprehended that that there could be a lay-off of around 1,100 employees if the plant remained inoperative for a longer period, besides its closure would tarnish the image of the country among the foreign investors. Cautioning that the plant's closure will send a very negative message to potential foreign and local investors and lead to further decline in FDI, the KCCI chief urged the finance minister to help resolve the issue of supplying gas to TSML at the ECC's ensuing meeting.
Copyright Business Recorder, 2014

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