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| Pakistan Oil Consumption in Barrels Per Day. Source: CEIC.com |
Oil consumption in Pakistan has shot up about 50% from 400,000 barrels per day in 2012 to nearly 600,000 barrels per day in 2017. During the same period, Pakistan's gas consumption has risen from 3.5 billion cubic feet per day to nearly 4 billion cubic feet per day, according to British Petroleum data.
Pakistan is among the fastest growing LNG markets, according to Shell 2017 LNG report. The country has suffered a crippling energy shortage in recent years as demand has risen sharply to over 6 billion cubic feet per day, far outstripping the domestic production of about 4 billion cubic feet per day. Recent LNG imports are beginning to make a dent in Pakistan's ongoing energy crisis and helping to boost economic growth. Current global oversupply and low LNG prices are helping customers get better terms on contracts.
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| Pakistan Gas Consumption in Billions of Cubic Feet Per Day. Source: CEIC.com |
Every modern, industrial society in history has gone through a 20-year period where there were extremely large investments in the energy sector, and availability of ample electricity made the transition from a privilege of an urban elite to something every family would have. It seems that Pakistan is beginning to recognize it. If Pakistan wishes to join the industrialized world, it will have to continue to do this by having a comprehensive energy policy and making large investments in the power sector. Failure to do so would condemn Pakistanis to a life of poverty and backwardness.
Pakistan is heavily dependent on energy imports to drive its economy. These energy imports put severe strain on the country's balance of payments and forces it to repeatedly seek IMF bailouts.
Pakistan needs to develop export orientation for its economy and invest more in its export-oriented industries to earn the hard currencies it needs for essential imports including oil and gas. At the same time, Pakistan is stepping up its domestic oil and gas exploration efforts. American energy giant Exxon-Mobil has joined the offshore oil and gas exploration efforts started by Oil and Gas Development Corporation (OGDC), Pakistan Petroleum Limited (PPL) and Italian energy giant ENI.
Related Links:
Haq's Musings
South Asia Investor Review
Pakistan Oil and Gas Exploration
US EIA Estimates of Oil and Gas in Pakistan
Pakistan Among Fastest Growing LNG Markets
Methane Hydrate Release After Balochistan Quake
Thar Coal Development
Why Blackouts and Bailouts in Energy-Rich Pakistan?
Riaz Haq's Youtube Channel
30 comments:
Did not know this but Pakistan's gas consumption per capita is 5 times as much as India's. That is staggering difference.
http://world.bymap.org/NaturalGasConsumption.html
2014 figures Pakistan 207 cubic meters per person vs India 42 cubic meters per person
Indus: "Did not know this but Pakistan's gas consumption per capita is 5 times as much as India's. That is staggering difference."
Yes, it's reflected in the total gas consumption figures for 2017:
Pakistan 3.95 billion cubic feet per day
India 5.25 billion cubic feet per day
https://www.ceicdata.com/en/indicator/india/natural-gas-consumption
https://www.ceicdata.com/en/indicator/pakistan/natural-gas-consumption
The per capita primary commercial energy consumption has increased dramatically since
1947, reflecting rapid rate of industrialization and a shift from non-commercial to commercial
sources of energy. In terms of oil equivalent, per capita commercial energy consumption
in Pakistan was mere 0.02 Ton of Oil equivalent (TOE) in 1947.
https://sdpi.org/publications/files/IP-Report.pdf
5 In 2012, per capita commercial
energy consumption is estimated
at 0.37 TOE, indicating a
compound growth rate of 6.5% for the
period 1947-2012.
6
Oil and gas resources account for
almost three-quarters ofthe energy consumption
in the country7 and natural
gas due to its convenience and cheapness
has proved over the years as the
best source of energy - partly replacing
coal.
8 Therefore, currently 49.5% of energy
needs are dependent on natural
gas, while Oil Imports account for
30.8%, LP 0.5%, Electricity (Hydro, Nuclear
& Imported) 12.5% and Coal
6.6%,
9 thus indicating the maximum dependence on natural gas
Total Energy Consumption Per Capita from 2003 to 2013 gives us a better perspective.
2003
Pakistan 648W
India 753W
2013
Pakistan 632W
India 806W
Per Capita total energy consumption went down in Pakistan!
http://data.worldbank.org/data-catalog/world-development-indicators
Pakistan is on the cusp of something large. It is evident in every corner of our towns. We have to control the religious thugs for a few years.
Anonymous: "--- We have to control the religious thugs for a few years.
And the non-religious ones too!
Early signs of economy are clear. Pakistan has turned the corner. Energy consumption is one good indicator. Other consumer consumption is booming. Saudi and Chinese funding is secured. IMF went back empty handed and Trump has been shown his place.
India Looks To Double Its Natural Gas Usage
https://oilprice.com/Energy/Natural-Gas/India-Looks-To-Double-Its-Natural-Gas-Usage.html
This week Indian Prime Minister Narendra Modi announced that this administration is working toward establishing a natural gas trading exchange as part of a larger effort to relieve the rapidly developing nation’s reliance on crude oil and its byproducts. A large motivator for the desired shift away from oil is the country’s ever worsening pollution problem.
At a New Delhi ceremony for the laying of a foundation stone for the development of city gas distribution (CGD) networks, Prime Minister Modi said that his government wants to “increase the use of natural gas by 2.5 times by the end of next decade." The plan is already getting underway with the construction of CGD networks in 129 districts auctioned so far.
The CGD networks underway are just one facet of India’s move to develop a transparent natural gas market. The price of gas would be determined on an exchange, with the intention of promoting a significant increase in the use of natural gas in the subcontinent’s total energy mix. The amount of natural gas in the current blend is just 6.5 percent, and Modi’s administration aims to raise the natural gas content to 15 percent between 2028 and 2030.
The Indian government has not yet disclosed the price tag for making this significant switch away from crude and toward natural gas. That being said, analysts have consistently said that using natural gas as fuel for vehicles and households alike is markedly less expensive than LPG, and considerably cleaner than petrol or diesel, a majorly important factor in the smog-choked country with an exponentially expanding middle class. As more people with buying power enter the market with the desire and the means to buy vehicles and power their homes, the importance of clean energy only becomes more dire.
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Another major factor of change in India’s energy industry at the moment is the projected decline of the nation’s traditional offshore assets over the next ten years. This will be offset by the planned deepwater and ultra-deepwater projects set for development in the Krishna-Godavari (KG) basin at the Bay of Bengal, but these projects will also be a major boon to Modi’s desired shift toward natural gas. The upcoming projects in the KG basin are, according to oil and gas analyst GlobalData, anticipated to meet the rapidly growing energy demand - natural gas especially - in India, in addition to reducing the nation’s dependence on imports by as much as 10 percent by 2023.
According to Prime Minister Modi, India has already begun the bidding process for what is now the tenth round of CGD, expanding the coverage to 400 districts (a whopping 70 percent of the country's total population) over the next two to three years. In addition, India is pouring 130 billion rupees (nearly $2 billion U.S. dollars) into constructing a pipeline to eastern India. This is a necessary development, as the east is the site of latent gas demand that has not yet been exploited thanks to the non-existent infrastructure (until now). This pipeline network, paired with the liquefied natural gas (LNG) terminals currently being developed on India’s east coast and the massive CGD network project, are expected to work together to significantly increase natural gas consumption in the Indian subcontinent.
Pakistan Council Of Renewable Energy Technologies (PCRET) Installs 562 Micro-hydel Power Plants To Electrify 80,000 Houses
https://www.urdupoint.com/en/pakistan/pakistan-council-of-renewable-energy-technolo-515947.html
Pakistan Council of Renewable Energy Technologies (PCRET), which is working under Ministry of Science and Technology, has installed 562 micro-hydel power plants with total capacity of 9.7 MW during the last five years, electrifying more than 80,000 houses.
An official source from Ministry of Science and Technology told APP that the ministry and its research and development organizations are mandated to develop technologies for socio-economic development of the country.
Technologies have been developed in different sectors like water, renewable energy, electronics, health, Small and Medium sized Enterprises (SMEs), industry, agriculture etc to directly and indirectly benefit a common man.
Listing different technologies developed during the last five years, the official source informed that PCRET has installed 155 small wind turbines in Sindh and Balochistan electrifying 1560 houses and installed 4016 biogas plants.
The council has established 20 KW hybrid system including solar, MHP and wind in collaboration with China for research and training purposes.
PCRET has also designed and stimulated Wind Turbine and solar products including Solar Cooker, Solar Dryer, Solar Water Heater and Solar Desalination.
During the last five years, Pakistan Council of Scientific and Industrial Research (PCSIR) which is also an important department of the ministry has developed Coal Water Slurry Fuel and Reinforced Derived Fuel and solar driven one inch and two inches water pumps. PCSIR has also designed the Solar Powered Reverse Osmosis Plant, the source said.
While National Institute of Electronics (NIE) has developed LED lights, Solar Charge Controller, Automatic Voltage Stabilizer and cascaded multilevel inverter based transformer-less Unified Power Flow Controller, it added.
#Pakistan #ExxonMobil offshore drilling site #Kekra-1 143 miles from #Karachi is among top 3 potential "big oil finds" in #Asia
https://www.bloomberg.com/news/articles/2019-01-14/oil-wildcats-to-watch-for-signs-of-asia-drilling-drop-reversal
“Explorers are getting a little bit more ambitious in this part of the world,” Andrew Harwood, the consultancy’s Asia-Pacific upstream research director, said in an interview in Singapore. “These are huge companies with global portfolios; they’re not spending the money to drill unless they have a reason to be excited.”
Wood Mackenzie expects mergers and acquisition spending in the region to total about $8 billion in 2019 after growing 60 percent to $8.7 billion 2018. Activity will be focused around divestments in Southeast Asia by companies that want to focus spending on U.S. shale.
Here’s a closer look at the three Asia-Pacific prospects Wood Mackenzie is paying the most attention to:
Pakistan
A group including Eni SpA and Exxon Mobil Corp. will start drilling the Kekra-1 well this month in deepwater south of Pakistan. The country’s onshore natural gas production has been declining after years of under-investment, leading to the start of liquefied natural gas imports in recent years. Growing demand for the fuel has made the drillers more confident that they’ll be able to sell any gas from a sizable development, Harwood said.
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Pakistan: ExxonMobil Begins Drilling off Karachi Coast
https://worldview.stratfor.com/situation-report/pakistan-exxonmobil-begins-drilling-karachi-coast
What Happened: ExxonMobil has begun drilling for oil and gas 143 miles off the coast of Karachi in the Arabian Sea, Daily Pakistan reported Jan. 10.
Why It Matters: The operations mark the first time an energy company is conducting offshore exploration along Pakistan's coast. An ExxonMobil executive has said the company has been considering launching operations in the region because of Pakistan's growing energy demand.
Background: Only 15 percent of Pakistan's energy consumption is met by domestic production. High energy prices have significantly inflated the country's import bill and contributed to draining its foreign exchange reserves.
#LNG imports in #MiddleEast plummeting. 37% slump in 2018 & prolonged negative outlook is in contrast to region’s 2-year LNG #gas demand surge. Oil prices barely enough to balance the budget of #Gulf monarchies of #SaudiArabia, #UAE, https://www.bloomberg.com/news/articles/2019-01-30/the-middle-east-s-once-hot-lng-market-faces-a-decade-long-slump via @markets
The Middle East was a bright spot for global liquefied natural gas demand in 2015. Now imports have plummeted so much that it could take a decade to recover.
Last year’s 37 percent slump and the prolonged negative outlook is in contrast to the region’s two-year LNG demand surge that outpaced global growth, according to BloombergNEF and ship-broker Poten & Partners Inc. data. The Middle East is now expected to make up less than 4 percent of global imports for at least eight years.
There are only five importers -- Egypt, Kuwait, Jordan, the United Arab Emirates and Israel -- of LNG in the Middle East. Bahrain is expected to join the group this year.
Why are LNG imports falling?
Gas finds in Egypt and the U.A.E. reduced the need for the liquefied fuel, and Jordan increased cheaper pipeline imports. “Domestic gas resources have been the main reason for LNG imports being subdued,” said Fauziah Marzuki, a senior associate at BNEF. Locally produced “gas will always be preferred over imports, within certain cost parameters of course.”
Which countries are leading the decline?
Egypt, the region’s biggest LNG importer in 2016 and 2017, will halt purchases this year and may resume exports thanks to surging domestic supplies from the giant Zohr field. Jordan will rely more on pipeline imports from Egypt, trimming its need for LNG. Bahrain, the only country that will add import capabilities in 2019, isn’t expected to reach meaningful volumes until 2022, according to BNEF forecasts.
Fizzling Gas
Liquefied natural gas imports in the Middle East had a record drop in 2018
What does this mean for Qatari exports?
Qatar, the world’s biggest LNG exporter, has boosted its position in the Middle East’s shrinking market since 2016. The exit of Egypt from the scene will likely erode that status. Almost half of Egypt’s imports came from Qatar last year. Still, the region isn’t a major market for Qatar and growth in Asia will more than offset declines in the Middle East.
How will this impact global markets?
Imports of LNG in the Middle East are dwarfed by Asia. Supply of the fuel -- driven by the U.S., Qatar and Australia -- is expected to rise almost 18 percent by 2030, and demand will grow more than double that rate. Even Kuwait, the region’s biggest importer, barely registers in global terms. Its imports are even less than the smaller markets in Asia such as Thailand, Bangladesh and Pakistan.
LNG Minnow
Middle Eastern countries to comprise just 3 percent of global demand in 2019
Gas shortage to increase by 157pc next fiscal year
Khaleeq Kiani Updated April 27, 2019
https://www.dawn.com/news/1478633
Gas shortage to increase by 157pc next fiscal year
Khaleeq Kiani Updated April 27, 2019 Facebook Count
With an addition of 700,000 consumers last year, Pakistan’s gas shortfall is estimated to jump by 157 per cent to 3.7 billion cubic feet per day (bcfd) in fiscal year 2019-20 — almost equal to total gas supplies at present.
The estimates have been made by the Oil and Gas Regulatory Authority (Ogra) that put the gas shortfall increasing almost continuously every year to 6.6bcfd by FY2028.
In its flagship “State of the Industry Report 2017-18”, the authority noted that the (natural gas) demand-supply gap during FY2017-18 was 1,447mmcfd and that this gap was expected to rise to 3,720mmcfd by FY2019-20. The regulator put the total gas demand at about 6.9bcfd in fiscal year 2019-20 compared to total supplies of about 3.2bcfd.
It said the demand would increase to 7.7bcfd by 2024 but domestic supplies would fall substantially to 2.3bcfd, leaving a shortfall at 5.5bcfd. The shortfall would practically be about 3.6bcfd in FY2024 as the gap would be partially met by about 1.9bcfd of imported LNG.
The domestic gas production would continue to decline from about 3.3bcfd at present to less than1.6bcfd by 2028 while the gas demand would keep going up to reach 8.3bcfd by that year. Ogra estimated that despite the induction of all the import options, including LNG, Turkmenistan-Afghanistan-Pakistan-India (TAPI) and Iran-Pakistan (IP) pipelines, the total supplies would decline to 3.7bcfd by 2028, creating a net shortfall of about 4.6bcfd, more than total supplies at present.
The regulator said the gap was rising because of higher consumption in almost all the major sectors particularly power, domestic, fertiliser, captive power and industry as the supplies were not keeping pace with higher demand.
Both the gas utility companies added around 0.7 million domestic, commercial and industrial consumers, in their respective systems, during fiscal year 2017-18. Consumer addition is increasing the gap between demand and supplies, day by day. Especially in winter, the gas demand further increased and as a result the government is being forced to curtail supplies to various sectors.
Despite this, the natural gas is a major contributing fuel in the country’s energy mix. Its share in the primary energy mix is around 48pc.
There is a significant rise in demand and consumption of gas by residential and domestic consumers owing to price differential vis-a-vis other competing fuels, i.e. liquefied petroleum gas (LPG), fire wood and coal. The LPG presently accounts for about 1.3pc of the total primary energy supply in the country.
The current size of LPG market is around 1.3 million tonnes per year. The LPG consumption has increased by 5.88pc in 2017-18 compared to the previous year.
LPG consumption during FY2017-18, stood at around 3,508 tons per day. Local production catered for around 58pc, the rest was imported.
The share of re-gasified LNG in the overall gas supply increased to 23pc in FY 2017-18. The total gas consumers were more than 9.2m by the end of FY2017-18, including 6.3m in the SNGPL network and 2.9m in the SSGCL network.
The power sector was the main consumer of natural gas during FY 2017-18, consuming 37pc, followed by domestic sector 20pc, fertiliser 17pc, captive power 10pc, industrial sector 9pc, transport 5pc, and commercial sector having 2pc share.
Punjab had the highest 50pc consumption, followed by Sindh 39pc, Khyber Pakhtunkhwa 9pc and Balochistan 2pc. Natural gas supplies during the year stood at 4.357bcfd, of which Sindh supplied 50pc, whereas Khyber Pakhtunkhwa, Balochistan and Punjab supplied 12, 11 and 4pc respectively. The remaining 23pc of gas was imported in the form LNG.
Powering #Pakistan. There is enough #coal at #Thar to cater for the #energy needs of the nation for two centuries. Imported #LNG #gas costs about 40% higher than Synthetic Natural Gas (#SNG) produced from Thar Coal. #power #electricity https://www.pakistantoday.com.pk/2019/07/15/powering-pakistan/#.XS3_3iOqyAc.twitter
BY DR FARID A MALIK
Pakistan is finally on the world Coal Map. On July 08, 2019 power generated from Thar Coal entered the national grid; electricity is now being produced by combustion of the local Lignite. At 175 billion tons this is one of the largest coal deposits of the world. The coalfield is spread over 9,000 square kilometers. It was discovered in 1996 by a joint investigation of Geological Survey of Pakistan (GSP) and United States Geological Survey (USGS). It is an important milestone, now that power can be generated by using indigenous fuel. Currently I am working on building an energy system based on this coal by using 21st century technologies.
In 1952 another important event took place when natural gas was discovered at Sui. With 12 trillion cubic feet (TCF) this was the largest deposit of its time. The Government of Pakistan (GoP) established a joint venture company called Pakistan Petroleum Limited (PPL) that pumps out gas from this resource. Two public sector companies distribute gas across the country. Sui Northern Gas Pipelines Limited (SNGPL) brings gas upcountry to Punjab and KP while Sui Southern Gas Company (SSGC) covers Sindh and Balochistan. The pipeline is spread over 20,000 kilometers, it is a state of the art system designed and built by local expertise. For fifty years (1952 to 2002) the energy needs of the nation were catered for by this source. Unfortunately due to misuse and mismanagement the resource has been depleted before its time. It is down to 2TCF now. Gas is being imported from Qatar to meet the shortfall of about 2000 mmcfd. The price of this imported gas at $11.4 per mmbtu is unaffordable. In the US this gas is sold at $3 per mmbtu.
Sui Gas was the energy gift of the founding fathers of Pakistan while Thar is our contribution to the coming generations which will long be cherished and utilised
There is enough coal at Thar to cater for the energy needs of the nation for two centuries. This resource can power Pakistan to prosperity. Mining of coal was the major challenge which has been overcome by a joint venture company formed by ENGRO and Government of Sindh (GoS) called SECMC (Sindh Engro Coal Mining Company). Coal is mined and then delivered at site to a power generation company called ENGRO Powergen Thar.
As Chairman Pakistan Science Foundation (PSF), I started working on the development of Thar Coal in 2004. In August 2018, after 14 years I stood at the bottom of the mine to touch the black gold for the first time. It was a dream come true. Sui Gas was the energy gift of the founding fathers of Pakistan while Thar is our contribution to the coming generations which will long be cherished and utilised.
No nation can prosper without covering its energy needs. Imported fuel cannot ensure sustainability. Rising costs of power and gas have substantially increased the cost of production rendering our exports non-competitive. The fuel advantage that we once had no longer exists. The black gold at Thar can revive the much needed competitiveness. Coal is being mined in Block II by SECMC while a Chinese consortium has started to dig in Block I. Thar Coal Energy Board (TCEB) has thus far demarcated 14 blocks for exploration.
Imported Liquefied Natural Gas (LNG) costs about 40% higher than Synthetic Natural Gas (SNG) produced from Thar Coal. Above ground gasification after mining is an established technology. There are several plants in Germany, South Africa, China and the US where coal is being used to produce multiple products that include; gas, fertilizer, diesel and chemicals. Pakistan can benefit from this know how that already exists.
#Italian, #Chinese major petroleum companies vie in #Pakistan's mega #LNG tender worth $5 billion to $6 billion. Pakistan to be a big growth driver in global LNG demand. Wood Mackenzie estimates the country will need 25 million tonnes a year. #energy #gas https://reut.rs/2LB7SbJ
Eni and PetroChina’s Singapore unit were joined by the trading arm of Azeri state oil company SOCAR and commodities trader Trafigura in placing offers, the sources said.
Pakistan LNG, the state-owned company that issued the tender, declined to name any bidders.
“The technical bids for our long-term LNG supply tender were received and opened yesterday. Evaluations are underway,” it said.
SOCAR Trading SA confirmed it had bid. Trafigura said it does not comment on tenders. A spokesperson noted Trafigura was a stakeholder in the terminal due to receive the tendered LNG.
“Trafigura owns 150 (million cubic feet a day) of LNG import capacity in that facility, which is key to its plan to supply LNG and gas to Pakistan’s private sector,” the spokesperson said.
#China Bids Lowest #LNG Price to #Pakistan Amid Massive #Gas Glut In #Asia. PetroChina International Singapore Quotes 8.594% of Brent oil contract for a delivery on February 16-17, 2020. #energy | OilPrice.com https://oilprice.com/Energy/Gas-Prices/China-Dumps-LNG-Amid-Massive-Glut-In-Asia.html?utm_source=tw&utm_medium=tw_repost #oilprice
PetroChina, one of the largest buyers of liquefied natural gas (LNG) in the key LNG demand growth market, has offered the lowest bid in an LNG tender in Pakistan, in a sign that the Asian market continues to be oversupplied even after the winter heating season began.
According to the documents from the latest Pakistan LNG tender, PetroChina International Singapore offered the lowest bid at a price slope—that is a percentage of the Brent oil contract—of 8.594 percent, for a delivery window on February 16-17. PetroChina beat commodity traders Gunvor and Trafigura and the trading arm of SOCAR to the lowest bid in the Pakistani tender.
It’s not certain if Pakistan will award this tender, because it sometimes chooses not to buy. But the fact that China is offering LNG so cheaply points to the persistent LNG glut on the Asian markets.
According to Bloomberg, this was at least the second time in which PetroChina has offered the lowest bid in an LNG tender in Pakistan.
This year, Asian spot LNG prices are at their lowest ever for this time of the season.
Last week was the first week since October in which spot LNG prices in Asia increased week on week. Asian LNG spot prices for delivery in January rose to US $5.65 per million British thermal units (MMBtu) last week, up by 15 cents from the previous week, trading sources told Reuters.
Still, prices were at their lowest for this time of the year, because of ample LNG supply and tepid demand growth with milder weather earlier in the heating season.
While the lower LNG prices create some demand in India, for example, overall demand in Asia this winter is certainly not growing at the record-breaking pace of the past three years. The reason—supply is more than enough, as new volumes continue to come out of the U.S., Australia, and to an extent, Russia.
Last month, a Singaporean buyer of a U.S. cargo of LNG canceled the loading, as both Asia and Europe are facing an LNG glut. Some other customers of U.S. LNG cargoes are also reportedly considering paying for those cargoes but not loading them, traders have told Reuters.
By Tsvetana Paraskova for Oilprice.com
Pakistan Energy Mix: Overview of Gas Sector (Upstream)
Pakistan imports almost 80% of its energy sources (oil, gas and LNG). GVS brings out a detailed report on Pakistan’s upstream sector to analyze country’s mammoth challenges. It examines how innovative policy making, better management and vision can still make a difference.
https://www.globalvillagespace.com/pakistan-energy-mix-overview-of-gas-sector-upstream/
The country used 28.1 million TOE of petroleum products in FY18, with 85 percent imported. Currently, Pakistan has a total of 9 million gas consumers in the country, with an annual addition of 0.5 million consumers. Sindh by far has the country’s largest gas production at 943,644 MCFt (65%), Balochistan at 310,535 MCFt (22%), KPK at 151,178 MCFt (10%), and Punjab 53,580 MCFt (3%).
Sindh also has three of the current largest fields producing gas, Mari, Qadirpur, and Kandhkot. Sui gas field in Balochistan, discovered in 1952, was Pakistan’s first and largest gas field found so far, had around 13 TCF of gas. It currently only has one TCF remaining and is nearing the completion of its life. These five fields represent over 50 percent of Pakistan’s recoverable reserves.
Gas Consumption
Pakistan has experienced major energy crises in the past decade as a result of expensive fuel sources, suffering from chronic natural gas shortages in the winter and electricity shortages in the summer, all exacerbated by the circular debt, and insufficient transmission and distribution systems over the past several years.
Roughly, 50 percent (about 105 million people) of Pakistan’s population still use biomass for cooking because of low electricity and gas supply. Natural gas plays a significant role in the energy matrix of Pakistan. In 2018, natural gas accounted for an estimated 30 percent of Pakistan’s primary energy consumption, petroleum at 35 percent, and coal at 16 percent.
Pakistan is the 20th largest gas consumer of the world, with an established natural gas industry since the 1950s. However, ironically Pakistan’s gas consumption is nearly the same as in France, which is a developed and industrialized country [with a GDP ten times bigger than Pakistan].
Natural gas consumption has increased from 1,377,307 MMCFt to 1,454,697 MMCFt. RLNG imports have increased to 313,902,345 MMBtu. There was a time when Pakistan was self-sufficient in gas. However, increased domestic demand over time, fueled by cheap mispricing of the natural resource, creation of the CNG motor vehicle industry, lack of alternative fuels, and diminishing production have resulted in increased amounts of imported gas.
In FY18, approximately 7.7 million TOE LNG gas was imported. Currently, Pakistan has over 9 million domestic consumers of gas, and these are growing by over 8% each year. The majority of domestic consumers, around 5.4 million, are based in Punjab; that account for 60 percent of the total domestic gas consumers, Sindh has 35 percent of the country’s domestic consumers at 2.6 million.
The primary energy supply amounts to over 70 million Tonnes of Oil Equivalent (TOE) (70X7.33=513 million barrels). Oil and gas are by far the dominating sources with a share of 80%. Oil is imported from the Middle East mainly Saudi Arabia, gas from Iran. In addition, Pakistan is consuming Liquefied National Gas (LNG), Liquefied Petroleum Gas (LPG) and coal. Pakistan has currently, 4 power plants with a total capacity of 755 MW; additional 3 are under construction.[4] Nuclear power accounts for around 1.9% of the total installed capacity in Pakistan.[5] Hydropower has a share of 13% whereas other renewable energies only play a minor role.
https://energypedia.info/wiki/Pakistan_Energy_Situation
The government is supporting the use of LPG for cooking resulting in rapid investment in production, storage and establishment of auto stations of LPG. During the FY 2016, an approximate investment of PKR 2.38 billion has been made in the LPG supply infrastructure whereas total investment in the sector until Feb 2016 is estimated at about PKR 22.33 billion. During the FY 2016, the regulatory body OGRA has issued 12 licenses for operational marketing of storage and filling plants, 37 licenses for construction of LPG storage and filling plants, 20 licenses for Construction of LPG auto-refuelling stations and one license for storage and refuelling of LPG was issued. Further, one license for construction of production and storage of LPG facility is also issued by OGRA which shall result in improving supply and distribution of LPG as well as create job opportunities in the sector.[4]
#Pakistan's Energas seeks approval to start spot #LNG imports of liquified natural #gas cargoes from July as the country looks to buy cargoes from the spot market to plug its #energy deficit. Energas looking to partner with ExxonMobil for imports. https://www.spglobal.com/platts/en/market-insights/latest-news/natural-gas/062920-interview-pakistans-energas-seeks-approval-to-start-spot-lng-imports
Cities like Karachi are facing severe power shortages. Consumers are subject to power cuts, ranging from two to eight hours every day, as power producers claim to be short of gas and furnace oil supplies, Khan said.
"According to our estimates, the current shortfall of gas for power generation in Karachi and other major cities in Pakistan would range between 200 MMcf/d to 300 MMcf/d", he added.
Khan said industrial power demand has picked up sharply as the lockdown, which was imposed some time back in a bid to fight the spread of the coronavirus, ended.
"The private sector has the ability to secure prompt supplies of molecules [LNG], whereas the government has to follow a set procedure of tendering that can take a minimum of 45 days to 60 days," Khan said.
He said the government has asked power projects to produce electricity on diesel due to a shortage of gas in the country. If private companies were allowed to secure LNG on a prompt basis, they could pass on significant cost benefits to end consumers.
"In today's market, power generation on diesel would cost Pakistani Rupees 18/unit while we would be able to produce electricity at about 60% less – Rupees 8/unit to be specific," Khan said.
Pakistan currently has two operational LNG terminals – Elengy Terminal, having a capacity of 600 MMcf/d, and Gasport Pakistan Ltd., also having a capacity of 600 MMcf/d. The government currently pays $500,000/d in capacity charges on a use-it-or-lose-it basis.
"Construction of more terminals would allow for greater competition but in my personal opinion, the country needs one or two additional terminals. The objective should be to support development of larger terminal capacity for current operational needs and future demand growth", Khan said.
With Pakistan turning to be one of the fastest growing LNG markets since it first started importing in 2015, with imports rising to 8.4 million mt in 2019 from 6.8 million mt in 2018, analysts say there is an urgent need to speed up import capacity expansions, which have been planned to absorb incremental inflows.
S&P Global Platts Analytics forecasts LNG imports to rise to 9.3 million mt in 2021, if Pakistan can bring in another FSRU relatively quickly. Imports are expected to exceed 17 million mt by 2025.
#Pakistan confirms large #oil-#gas discovery in #KPK. Pakistan imports 80% of its oil-gas needs costing $13 billion a year. Pakistan's total oil production is 89,000 barrels per day & 3,936 million cubic feet per day (mmcfd). Annual demand is rising 8%. https://gn24.ae/a2e28c2962dc000
Pakistan has discovered new deposits of oil and gas in the Kohat district of Khyber-Pakhtunkhwa province.
The discovery was reported by state-owned firm, Pakistan Oilfields Ltd. (POL), at the exploratory well in Tal Block, Mamikhel South-01. Tal Block is considered one of the largest hydrocarbon producing blocks in the country.
“Well test has shown 3,240 barrels of condensate per day, 16.12 mmscf (million standard cubic feet) of gas per day, and 48 barrels of water per day,” POL announced in a notification on Pakistan Stock Exchange (PSX). “Actual production may differ significantly from the test results.”
POL holds 21 per cent stake in the Tal Block while Pakistan Petroleum Ltd. (PPL) and Oil and Gas Development Company (OGDC) each own 28 per cent.
MOL Pakistan, a fully owned subsidiary of Hungarian multinational oil and gas exploration firm MOL Group and which has about 8.4 per cent in the Tal Block also shared the news of “significant” gas and condensate reserves in Pakistan.
“I am delighted to announce that we have made another discovery in Pakistan,” Berislav Gaso, MOL Group’s exploration and production Executive Vice-President, said. “This new discovery has de-risked an exploration play in deeper reservoir in the Tal Block, leading to new upside opportunities. The Mamikhel South-1 discovery will also help to improve the energy security of the country from indigenous resources.”
PROMISE OF MUCH MORE
The Mamikhel South-1 exploratory well in the Tal Block, achieved a flow rate of 6,516 barrels of oil equivalent per day during testing, the company said. This marks MOL’s 13th discovery in Pakistan and the 10th discovery in the Tal Block. MOL is one of the key LPG and gas producers in Pakistan.
The current discovery comprises about 15 per cent and 5 per cent of Tal Block’s present total oil and gas production respectively, reports suggest. Mamikhel South is soon expected to be added to production due to its proximity to another field.
Experts have welcomed the news of recent discovery, but also called for the exploitation of unconventional oil and gas assets - such as shale oil and shale gas - as well as inviting foreign companies to boost the country’s oil and gas sector.
Pakistan relies on imports for about 80 per cent of its energy requirements, spending nearly $13 billion a year on crude oil and gas. The country’s total oil production stands at 89,000 barrels per day (bpd) and 3,936 million cubic feet per day (mmcfd). Demand is increasing by 8 per cent a year.
According to the details shared by Pakistan LNG, PLL was the lowest bidder, which quoted a remarkable rate of *5.7395%* of Brent (approx. USD 2.2/mmbtu) for the cargo. Prices quoted by the other three bidders are Gunvor 7.8421%, PetroChina 8.3500%, Trafigura 10.3811%.
https://propakistani.pk/2020/07/28/pakistan-is-buying-its-cheapest-lng-cargo-ever-at-a-record-low-price/
PLL received an offer for an Aug 27-28 delivery cargo at about $2.20/mmbtu. It is worth mentioning that Pakistan has been out of the spot market in 2020, and this is their first tender since November 2019.
A.A.H Soomro, managing director at Khadim Ali Shah Bukhari Securities told ProPakistani,
This is a game-changer! It’s time for Pakistan to relook at long term LNG contracts and move towards Spot purchase. Let’s assess the possibility of cancellation of the contracts. Bargain in your favor. This solves half of Pakistan’s problems if we speedify the LNG terminals. The economy would grow in leaps and bounds if we reduce energy costs now.
This is lower than the Asian LNG spot price LNG-AS for August which on Friday was estimated to be about $2.35 per mmBtu. The prices are expressed in the document as a “slope” of crude oil prices, a percentage of the Brent crude price, and are typically a pointer for the opaque spot LNG market.
Pakistan LNG has a separate tender to buy two LNG cargoes for delivery in September which closes on August 4.
Fitch Solutions stated that Asian spot LNG prices continue to hover at historical lows as COVID-19 continues to drag economic activity and demand.
The spot prices in Asia have remained depressed accordingly, falling by more than 50% since the start of the year to hit USD 2.5/mmBTU at the time of writing in July, from USD 4.0/mmBTU in January. YTD prices are shown to have averaged USD 2.7/mmBTU, halved from USD 5.4/ mmBTU in 2019 and less than a third of the USD 9.7/mmBTU averaged in 2018.
LNG imports into key importing markets in Asia – apart from China – have registered large y-o-y declines across the board as gas consumption across industry and commercial sectors slowed to a crawl as strict COVID-19 containment measures were observed.
The outlook for LNG prices was hardly rosy coming into the year even before the onset of the coronavirus pandemic, amid a negative backdrop of slowing coal-to-gas switching in China and a milder winter, although it looks to have deteriorated further as energy demand sinks across the region.
Pakistan’s Gwadar loses lustre as Saudis shift $10bn deal to Karachi
https://www.ft.com/content/88cfe78b-517f-41d9-97d1-9f7f540f517c
Saudi Arabia has decided to shift a proposed $10bn oil refinery to Karachi from Gwadar, the centre stage of the Belt and Road Initiative in Pakistan, further supporting the impression that the port city is losing its importance as a mega-investment hub. On June 2, Tabish Gauhar, the special assistant to Pakistan’s prime minister on power and petroleum, said that Saudi Arabia would not build the refinery at Gwadar but would construct it along with a petrochemical complex somewhere near Karachi. He added that in the next five years another refinery with a capacity of more than 200,000 barrels a day could be built in Pakistan. Saudi Arabia signed a memorandum of understanding to invest $10bn in an oil refinery and petrochemical complex at Gwadar in February 2019, during a visit by Crown Prince Mohammad Bin Salman to Pakistan. At the time, Islamabad was struggling with declining foreign exchange reserves.
The decision to shift the project to Karachi highlights the infrastructural deficiencies in Gwadar.
A Pakistani official in the petroleum sector told Nikkei Asia on condition of anonymity that a mega oil refinery in Gwadar was never feasible. “Gwadar can only be a feasible location of an oil refinery if a 600km oil pipeline is built connecting it with Karachi, the centre of oil supply of the country,” the official said. There is currently an oil pipeline from Karachi to the north of Pakistan, but not to the east.
“Without a pipeline, the transport of refined oil from Gwadar [via road in oil tankers] to consumption centres in the country will be very expensive,” the official said. He added that at the current pace of development he did not see Gwadar’s infrastructure issues being resolved in the next 15 years.
The official also hinted that Pakistan’s negotiations with Russia for investment in the energy sector might have been a factor in the Saudi decision. In February 2019, a Russian delegation, headed by Gazprom deputy chair Vitaly A Markelov, agreed to invest $14bn in different energy projects including pipelines. So far these pledges have not materialised, but Moscow’s undertaking provided Pakistan with an alternative to the Saudis, which probably irritated Riyadh.
Arif Rafiq, president of Vizier Consulting, a New York-based political risk firm, told Nikkei that a Saudi-commissioned feasibility study on a refinery and petrochemicals complex in Gwadar advised against it. “Saudi interest has shifted closer to Karachi, which makes sense, given its proximity to areas of high demand and existing logistics networks,” he added.
Rafiq, who is also a non-resident scholar at the Middle East Institute in Washington, considers this decision by the Saudis as a setback for Gwadar, the crown jewel of the China-Pakistan Economic Corridor, the $50bn Pakistan component of the Belt and Road.
The Saudi decision “is a setback for Pakistan’s plans for Gwadar to emerge as an energy and industrial hub. Pakistan has struggled to find a viable economic growth strategy for Gwadar,” he said. Any progress in Gwadar in the coming decade or two will be slow and incremental, he added.
Local politicians consider the shifting of the oil refinery a huge loss for economic development in Gwadar. Aslam Bhootani, the National Assembly of Pakistan member representing Gwadar, said the move is a loss not only for Gwadar but for all of the southwestern province of Balochistan. He said he would urge the Petroleum Ministry of Pakistan to ask the Saudis to reconsider their decision.
The decision has shattered the image of Gwadar as an up-and-coming major commercial hub. In February 2020, the Gwadar Smart Port City Masterplan was unveiled, forecasting that the city’s economy would surpass $30bn by 2050 and add 1.2m jobs. Local officials started calling Gwadar the future “Singapore of Pakistan”.
Pakistan has a well-developed and integrated infrastructure for the transmission and
distribution of natural gas.
https://www.adb.org/sites/default/files/linked-documents/48307-001-ssa.pdf
Its natural gas pipeline system is about 145,633 kilometers (km) long,
of which 134,489 km are distribution pipelines and 11,144 km are high-pressure transmission
lines (footnote 5). Transmission and distribution of natural gas in the northern and central
regions of Pakistan is undertaken by Sui Northern Gas Pipelines Limited (SNGPL)6 while
Sui Southern Gas Company Limited (SSGC) covers the southern region of Pakistan where the
project is located (footnote 6).
#Pakistan gets $4.5 billion facility for #oil, #LNG imports. 3-year trade financing facility from Jeddah-based #Islamic Trade Finance Corporation (ITFC) will cover import cost of crude, petroleum products and liquefied natural gas (LNG). #SaudiArabia https://www.dawn.com/news/1631303
A formal financing framework agreement on the arrangement would be signed early next week here, informed sources told Dawn. The funds would be utilised under Annual Financing Plan of roughly $1.5bn each. This trade financing arrangement is in addition to about $531 million already signed by Ministry of Economic Affairs with Saudi Fund for Development (SFD) for project financing of Mohmand dam, a couple of coal based projects besides a few hydropower projects including two in Azad Kashmir.
The ITFC’s financing would be utilised over three years (2021-23) by Pak-Arab Refinery Ltd (Parco), Pakistan State Oil (PSO) and Pakistan LNG Ltd (PLL) for import of crude oil, refined petroleum products and LNG and help augment the country’s foreign currency reserves and provide resources to meet the oil import bill.
Pakistan’s oil import bill has amounted to about $10bn in first 11 months of the current fiscal year but has been rising in recent months because of increasing trend in the international oil prices. In first 11 months, Pakistan has imported about $2.5bn each worth of LNG and crude oil besides $4.5bn worth of refined petroleum products.
ITFC is a member of the Islamic Development Bank Group and provides trade financing to member countries after putting together funds from financial institutions in the Middle East. The sources said Pakistan had last year signed a $1.1bn trade financing facility for the current year but could not be fully utilised due to lower international oil prices, depressed demand in Pakistan and limitations of the refineries in availing Arabian Crude.
The sources said the financing cost for the upcoming financing facility would be lower than the existing one given substantial surplus liquidity of the banks in the United Arab Emirates and Saudi Arabia because of constrained business activities in the wake of ongoing Covid-19 wave. The existing facility envisaged 2.3pc plus London Inter-Bank Offered Rate (Libor).
The source said the two sides may cover the agricultural commodities as well including DAP fertiliser in addition to existing pipeline of crude, oil products and liquefied natural gas. The sources said the ITFC had also committed in April 2018 a similar financing line for Pakistan for 2018-20 but utilisation finally could not cross $3bn as private refineries were unable to import crude under the facility as it was mostly limited to Parco and to some extent PSO.
Before 2018, the ITFC’s financing was available only to Pak-Arab Refinery which was expanded to Pakistan State Oil in 2018. Last year, PLL was also included in the arrangement for the first time. ITFC had a limited portfolio of about a billion dollars of its own and normally arranged funds from other private financial institutions. Some of the other major recipients of the ITFC’s trade facility have been Indonesia, Egypt and Bangladesh.
The facility is expected to provide relief in oil and gas import bill and ease pressure on foreign exchange reserves. Under the facility, funds do not come into Pakistan’s account but ease pressure on foreign exchange reserves. These funds would be used for financing of letters of credit for oil and LNG imports by PSO, Parco and PLL.
#Pakistan's domestic #oil consumption in FY2021 (July 2020-June 2021) totaled 19.45 million tons, up 19% from the 16.36 million tons in the previous year as #economic activity picked up and the country's imports moved to Euro 5. #energy #economy #COVID https://www.spglobal.com/platts/en/market-insights/latest-news/oil/080321-pakistan-to-explore-wide-middle-distillate-supply-options-amid-tight-chinese-exports
Pakistan plans to secure adequate supply of middle distillates to supplement its improving economy but expectations of tight Chinese motor fuel exports for the second half of 2021 may prompt the South Asian nation to raise imports from other main supply sources in the Middle East, according to oil product trading sources and market analysts based in Karachi.
Pakistan's domestic oil consumption in fiscal year 2021 (July 2020-June 2021) totaled 19.45 million mt, an increase of 19% from the 16.36 million mt consumed over the same period the previous year as an improvement in domestic economic activity led to a strong uptick in gasoil and gasoline demand, data by the country's Oil Companies Advisory Council showed.
The uptick in gasoil demand was evidenced by the 18% year-on-year jump in diesel sales over FY 2021 to 7.699 million mt, in contrast with 6.546 million mt consumed in FY 2020, the data showed.
Easing COVID-19 restrictions during the last fiscal year increased industrial activity, boosting overall demand for petroleum products, which helped the economy to grow 3.94% after two years, Shahrukh Saleem, research analyst at Karachi-based ALD Securities, said.
Moreover, diesel sales also increased on the back of a stimulus package in the farming sector, with subsidies given to the sector to aid in the increase in agricultural output, another industry source said.
In addition to gasoil demand, Pakistan also recorded a sharp year-on-year growth in gasoline consumption -- the result of a recovering automobile sector.
According to data from the OCAC, Pakistan's petrol sales recorded an increase of 13% to 8.237 million mt in FY 2020.
"Lower interest rates enticed consumers to borrow funds to buy cars on installments," Tahir Abbas, head of research at Arif Habib Securities, said.
In FY 2021, domestic car sales rose to 181,397 units, from 111,632 units a year earlier, data from Pakistan's Automotive Assemblers Association showed.
Middle distillate supply sources
The improvement in Pakistan's gasoil and gasoline demand helped to absorb barrels from the regional market, with traders saying that this may have a knock-on effect of shoring up prices should this upward trend be sustained.
Pakistan imported around 800,000 mt of gasoline from China in H1 2021, almost double the 437,000 mt received in H2 2020, latest data from China's General Administration of Customs showed.
This is especially so given that regional supply balances are tightening, with several sources noting that deep cuts to oil product export volumes from North Asian producers, in particular China, have resulted in a tight outlook for the rest of 2021.
China's middle distillate exports are expected to fall over the coming months as Beijing looks to limit oil product export permits in an effort to cut emissions to meet the country's carbon zero target, while reserving enough barrels for domestic consumers.
Beijing is likely to allocate about 7.5 million-9.5 million mt of quotas for exporting gasoline, gasoil and jet fuel in the final round of allocation for this year, S&P Global Platts reported earlier. If the allocation hits 9.5 million mt, the total allocation would work out to 39 million mt for 2021, about 14.7% lower from the actual export level of 45.75 million mt in 2020, Platts calculations showed.
Reflecting the tight supply outlook, the physical FOB Singapore 10 ppm sulfur gasoil crack spread against front-month cash Dubai averaged $6.96/b over July, sharply higher than the $5.17/b average in January.
Global #energy prices surging! #Pakistan & #Bangladesh are among developing nations in #Asia that can no longer afford to pay soaring #LNG prices, raising the risk of power rationing or the burning of dirtier alternatives this winter. #gas #inflation https://www.bloomberg.com/news/articles/2021-09-01/developing-asia-faces-power-curbs-more-pollution-on-gas-rally
Bangladesh’s state-run Petrobangla plans to stop buying spot LNG cargoes for the rest of the year after a quadrupling of prices over the past year to a seasonal high. Pakistan has repeatedly canceled and reissued LNG purchase tenders in an effort to get better offer prices, without avail.
The evolution marks a stark turnaround after developing Asia helped drive a surge in trading of the super-chilled fuel and built LNG import strategies on the premise that spot shipments would be abundant and cheap. Unlike richer counterparts in the region that can pass on this year’s historic price rally to end-users, some governments may need to rethink LNG procurement strategies and reduce exposure to the volatile spot market, switch to dirtier fuels such as coal or oil or even curb electricity production.
“With spot prices so high and with relatively low development, these countries may not be able to afford the current sky-high prices for gas on the global market,” said Ron Smith, senior oil and gas analyst at BCS Global Markets. A return of power rationing this winter “seems quite possible” for Bangladesh and Pakistan.
Nations in South Asia have the most potential to take advantage of cheaper fuel oil to offset the rise in spot LNG prices through this winter, said Felix Booth, head of LNG at energy-intelligence company Vortexa.
#Pakistan's oil products consumption rose 24% on the year to 5.863 million tons over July-September due to a rebound in #industrial and #transportation activity and an increase in demand for fuel oil following a rise in #LNG prices. https://www.spglobal.com/platts/en/market-insights/latest-news/oil/102121-china-data-pakistan-top-destination-for-chinas-september-gasoline-exports
Pakistan emerged as the top destination for China's gasoline outflows in September, surpassing the traditional destination of Singapore, data released by the General Administration of Customs showed on Oct. 20.
Total exports to Pakistan rose to 242,000 mt, surging 227.5% from August, and also up 126% on the year.
Thanks to the sharp increase in September, total exports to Pakistan were at 926,000 mt over the first nine months of the year, soaring 765.8% on the year, the sharpest jump among all the top 10 destinations. Exports to Indonesia also increased sharply by about 140.9% year on year to 838,000 mt.
Pakistan's oil products consumption rose 24% on the year to 5.863 million mt over July-September due to a rebound in industrial and transportation activity and an increase in demand for fuel oil following a rise in LNG prices.
The country's oil demand is poised for robust growth as a central bank stimulus package and healthy farm sector growth underpin a broader economic recovery and boost vehicle sales, according to analysts.
"We are eyeing growth of 4%-5% in diesel sales and 12%-15% in petrol sales this year, given the recovery in economic activity," said Atif Zafar, chief economist and director research at Topline Securities, a Karachi-based brokerage house. "The higher liquidity has resulted in an increase in car sales, which in turn will also result in higher petrol sales," Zafar added.
Meanwhile, September outflows to Singapore jumped 495.8% on the month to 209,000 mt, but still down 60.7% on the year.
Despite an year-on-year decline, Singapore still took about 39.5% of China's total gasoline outflows during January-September, compared with 52% during the same period last year.
China's September gasoline exports have recovered from a 30-month low of 568,406 mt in August to 920,000 mt in September, up 61.9% on the month.
The outlook for gasoline demand remains bullish in Asia and the Middle East, as economic activity started to pick up in September, with sources noting movement of cargoes towards end-users in Pakistan.
"The strength in Asian gasoline is apparent in cargoes flowing out of China and various parts of Asia to meet the prompt demand in Southeast Asian countries," said a Singapore-based source.
"We are starting to see slow improvements... spot tenders in Pakistan and cargoes are heading there," another Singapore-based source said in September.
"PSO [Pakistan State Oil] has also issued buy tenders for 92 RON gasoline for October and November this month," the source added.
Gasoil
China also revived its gasoil exports last month with the new quota allocated in early August.
As a result, Australia returned as the second top recipient of China's gasoil in September, with 118,000 mt exported, compared with zero in August.
In September, Australia's appetite for gasoil improved following easing of some pandemic-related restrictions amid progress in the country's vaccination program.
"Australia's demand has been quite supported due to mining demand, especially given how high coal prices are now. But of course, the easing of restrictions will help in the recovery of gasoil demand," said a Singapore-based trader.
Bangladesh also increased its gasoil imports from China in September, with around 113,000 mt arriving last month, up 75.5% from August.
Accordingly, total exports to Bangladesh surged 67.9% on the year over January-September, up 67.9%, the sharpest growth among the top five recipients -- with four in Asia and the fifth being Australia in Oceania.
Arif Habib Limited
@ArifHabibLtd
During CY21, industry recorded highest ever MoGas sales of 8.6mn tons. Moreover, total industry sales surged by 19% YoY to 20.8mn tons during CY21.
https://twitter.com/ArifHabibLtd/status/1478004863250440193?s=20
#Pakistan to burn more domestic #coal for #electricity. Work on 3rd phase of Thar Coal Block II mine is to begin this year at an estimated cost of $93 million. Annual production of lignite to grow from 3.8 million tons to 12.2 million tons by 2023. #CPEC https://asia.nikkei.com/Spotlight/Environment/Climate-Change/Pakistan-to-burn-more-domestic-coal-despite-climate-pledge
Work on the third phase of the Thar Coal Block II mine expansion is set to begin this year at an estimated cost of $93 million, according to the Sindh Engro Coal Mining Company (SECMC), a public-private enterprise operating the mine since 2019 in the southeastern district of Tharparkar. The second phase of expansion is underway with the help of China Machinery Engineering Corp. and Chinese bank loans, in addition to local financing. The series of expansions will scale up the annual production of lignite from 3.8 million tons to 12.2 million tons by 2023.
The output from the second phase of expansion will feed two 330 MW coal-fired power plants being built under the $50 billion China Pakistan Economic Corridor projects, part of Chinese President Xi Jinping's flagship Belt and Road Initiative. The power plants are expected to come on line this year.
Lignite is brown coal with low calorific value due to high moisture and low carbon content.
The expansion of the Thar coalfields is aimed at curbing coal imports to ease a staggering current-account deficit made worse by soaring international commodity prices and shipping costs. Pakistan's current-account deficit ballooned to an unprecedented $9.09 billion between July and December last year, as imports continued to outstrip exports during the post-COVID economic recovery. Pakistan had to seek a $3 billion loan and a deferred payment facility on the import of petroleum products from Saudi Arabia last year to stabilize forex reserves.
In recent years, high volatility in international oil prices, soaring LNG prices and dwindling local gas reserves have spurred public-private spending, particularly Chinese investment, in Pakistan's coal power sector. Until now, four coal-fired power plants with 4.62 GW of total installed capacity have joined the grid, while another three plants with an aggregate capacity of 1.98 GW are expected to come online over the next two years -- all under CPEC. In addition, growing demand from cement factories banking on a global construction boom has tripled coal consumption over the last five years to 21.5 million tons per annum.
Consequently, the share of coal in Pakistan's import bill for the year ended June 2021 shot to 24% from over 2% in previous years, according to data from the Pakistan Bureau of Statistics. Currently, only the power plant at Thar Coal Block II is running on indigenous coal.
A spike in coal power generation is in line with global trends, where countries including China, the U.S. and India have turned to coal to meet heightened demand following the lifting of COVID-19 restrictions.
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Authorities contend that the expansion of Thar Coal Block II will reduce the price of indigenous coal from $60 to $27 per ton -- making it the country's cheapest power source and leading to annual savings of $420 million. Pakistan is currently importing coal at around $200 per ton.
"We are compelled to use this cheap source of energy because we cannot keep using dollars to run power plants running on expensive furnace oil and RLNG (re-gasified liquefied natural gas)," Sindh Provincial Energy Minister Imtiaz Shaikh told Nikkei Asia. "We would like to mix 20% Thar coal [in power plants running] with imported coal. Then we will move towards converting coal to liquid and coal to gas."
The cost of operating thermal plants has become punishing due to expensive fuel and the cost of diverting scarce freshwater, which leads to underutilization of the plants, said Omar Cheema, director of London-based renewable energy consultancy Vivantive.
10,707 km pipelines being laid to reinforce gas transmission network in Pakistan
https://pakobserver.net/10707-km-pipelines-being-laid-to-reinforce-gas-transmission-network/
The two state-owned companies, SNGPL and SSGC, are in process of laying almost 10,707-kilometer pipelines to reinforce gas transmission networks in their operational areas across the country during the current fiscal year.
The Sui Northern Gas Pipelines Limited (SNGPL) would place 9,605 kilometers and Sui Southern Gas Company (SSGC) 1,102 transmission and distribution pipelines in their respective areas during 2022-23 aimed at improving the efficiency of the commodity supply to domestic, industrial, and commercial consumers.
The companies would collectively spend funds amounting to Rs 113.899 billion on the upgradation of the gas transmission and distribution system. “The SNGP and SSGC have planned to invest Rs 27,669 million on transmission projects, Rs 77,484 million on distribution projects, and Rs 8,746 million on other projects bringing the total investment of Rs 113,899 million during the fiscal year 2022-23,” according to an official document available with APP.
The available statistics indicated that Pakistan has an extensive gas network with more than 13,513 KM transmission, 155,679 KM distribution, and 41,231 KM service gas pipelines for cater to the requirement of millions of consumers.
The companies are also executing at least three strategic projects to supply gas to two Special Economic Zones (SEZs) and an industrial park in their respective areas to boost industrial production.—APP
State-owned Pakistan LNG (PLL) has announced its intention to secure nine LNG cargoes during the months of October, December, January 2024, and February 2024.
https://www.naturalgasworld.com/pakistan-floats-two-tenders-for-spot-lng-cargoes-105642
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The federal government issued two tenders seeking spot liquefied natural gas (LNG) cargoes for the first time in nearly a year on Tuesday, while also announcing a deal that will see Azerbaijan provide the country with one LNG cargo per month.
https://www.dawn.com/news/1759531
Dependent on gas for power generation and running short of foreign exchange to pay for imports, the country has struggled to procure spot cargoes of LNG after global prices spiked last year following Russia’s invasion of Ukraine, leaving it to face widespread power outages.
But Asian spot LNG prices this year have eased from record highs of $70 per million British thermal units (mmBtu) hit in August, and are now trading below $10.
Pakistan LNG, a government subsidiary that procures LNG from the international market, has one tender seeking six cargoes on a delivered-ex-ship (DES) basis to Port Qasim in Karachi in October and December, according to the tenders posted online.
The delivery windows are October 5-6, 20-21 and 31, and December 7-8, 13-14 and 24-25. The tender will close on June 20.
Pakistan LNG’s second tender seeks three cargoes, also on DES basis to Port Qasim, for delivery windows of January 3-4, 28-29 and February 23-24. The second tender closes on July 14.
Pakistan LNG last issued a tender seeking 10 spot cargoes in July 2022, but received no offers.
Separately on Tuesday, Minister of State for Petroleum Musadik Malik told a news conference that Azerbaijan will supply an LNG cargo every month to Pakistan at a “cheaper price”.
He did not share details on the supply deal, but said that a contract had already been signed with Azerbaijan and that it will “start soon”.
Pakistan has two long-term supply deals with Qatar, one signed in 2016 for 3.75 million metric tons of LNG a year, and another signed in 2021 for 3m metric tons a year.
It also has an annual portfolio contract with ENI for 0.75m metric tons a year.
In 2022, Pakistan’s imports of LNG slowed to 6.93m metric tons for the year, down from 8.23m metric tons in 2021, according to data from data analytics group Kpler.
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