Oil, gas: Exploration and production sector has seen $10b investment, says Abbasi

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Oil, gas: Exploration and production sector has seen $10b investment, says Abbasi
Oil, gas: Exploration and production sector has seen $10b investment, says Abbasi

ISLAMABAD: The government is claiming that foreign and domestic companies have invested $10 billion in the petroleum exploration and production (E&P) sector during the last four years – effectively, the time PML-N has been in power, but also overlapping with a bearish oil market.

Addressing a press conference on Monday, Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi said that investment of $10 billion is encouraging for the economy, particularly at a time when investment dropped 40% globally owing to low oil prices.

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Talking about the status of construction of a gas pipeline from Lahore to Karachi, he said that gas utility companies have completed the first phase of the pipeline and work on the second phase is in progress.

The 1,100 kilometre pipeline with a capacity of 12.4 billion cubic metre per annum will connect Karachi’s liquefied natural gas (LNG) terminals with those in Lahore.

He further said that 101 discoveries have been made during the last four years; as many as 83 wells of oil and gas have been discovered in Sindh and seven discoveries have been made in both Punjab and Khyber-Pakhtunkhwa.

Abbasi revealed that the re-bidding process of awarding blocks in Balochistan has been initiated. He admitted that the government had to cancel licences issued against various blocks in Balochistan as they could not start exploration activities due to the law and order situation.

The government has claimed credit for inclusion of 5.2 trillion cubic feet gas in natural gas pipeline during the PML-N tenure through 68 discoveries, which would help the country overcome gas load-shedding in winters.

Recently, he pointed out oil and gas company, Petroleum Exploration Limited, succeeded in discovering 765 barrel oil and 24 cubic feet gas in Badin area. Oil and Gas Development Company (OGDC) also started drilling of three wells.

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“5.2 trillion cubic feet gas has been discovered since PML-N took the government in 2013. Now, the volume of discovered gas is much higher than consumption in the country.”

Responding to a question, regarding unaccounted for natural gas (UFG), the minister said that reduction in gas theft has been observed in both gas companies. SNGPL has reduced UFG by 40% if data of Karak is excluded where gas theft is high, said Abbasi, adding that provincial governments are responsible to stop gas theft. SSGC had also brought UFG level below 10%, he added.

He further disclosed that the proposal to change gas distribution formula – to treat all the residential consumers across the country equally irrespective of gas produced in one province or the other – will be taken again in the meeting of the Council of Common Interest (CCI). The meeting of CCI has been scheduled for July 31, he added.

“The federal government has provided industry and commercial ventures to use LNG as an alternative fuel,” said the minister.

He said that there would be zero load-shedding for domestic consumers in the upcoming winter season.

Talking about the Iran-Pakistan (IP) gas pipeline, he said the project was still facing problems due to sanctions imposed by the United States against Tehran.

The petroleum ministry has also assured supply of LNG for one more LNG-based power plant in Punjab province, he added.

Published in The Express Tribune, July 18th, 2017.

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Originally Posted on Tribune

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