Pakistan is all set to offer its gas deposits to foreign energy companies. The offer reportedly would boost domestic production in the midst of soaring demand, as per government officials. The country reportedly has trillions of cubic feet in natural gas reserves, and some of these have been exploited, however, the last decade has observed an outflow of foreign energy investors attributed to Islamist violence.
In the backdrop of the country’s fast-rising population, imports of gas and LNG are on the rise. Meanwhile, Imran Khan’s government reportedly is aware that domestic production is almost customarily cheaper. This has resulted in the country preparing to tender gas blocks to all parties interested in the exploration.
Nadeem Babar, the head of the government’s task force for an energy reform stated that the government was in the process of making changes to its production regulations and natural gas exploration. He added that the process would also include drafting the country’s first ever shale resource policy. Meanwhile, the country’s Minister for Petroleum and Natural Resources stated that the country provides a level playing field for the E&P companies. It was also reported that the state-owned companies would participate in bidding rounds and compete with other companies.
Pakistan reportedly imports nearly 80% of its energy requirements from the international market. The country’s demand for energy has also been increasing by 8% a year. Meanwhile, the government was doing its best to make the country a more investor-friendly and change the status quo in energy supply and demand. Its estimated conventional gas reserves of 20 trillion cubic feet and shale gas reserves exceeding 100 trillion cubic feet makes the country an attractive destination for gas drillers. It is reported that government officials were negotiating an increase in Qatari LNG imports from 500 billion cubic feet to 700 billion cubic feet daily. And, the government has also inked an import deal with Gazprom for 500 million to 1 billion cubic feet daily. Recently, it also completed two LNG import terminals, however, the super-cooled fuel is said to be more expensive than Islamabad would like – due to its level of import dependency.
It has been also reported that according to Nadeem Babar, Aramco, Gazprom, and Exxon have expressed interest in some of the blocks that would be auctioned later this year. Meanwhile, Italy’s Eni is reportedly active in Pakistan and in all probability would join the bidders along with others attracted by the underexplored resources in the country – where one of three wells yields commercial gas.