Review of strategic units sell-off suggested: Energy security
By Khaleeq Kiani
ISLAMABAD, March 14: The Planning Commission has asked the government to re-examine the policy of selling strategic assets in the energy sector to foreign investors because this may have far-reaching impact on country’s energy security, it is learnt.
The commission believes that powerful international players were in competition to control as much of energy resources as possible due to the rising oil crunch and hence it would be advisable for Pakistan to give a comprehensive “re-look” at its policy of privatizing strategic energy sector assets.
The advice has come at a time when the privatization of major oil and gas sector entities like Pakistan State Oil (PSO), Pakistan Petroleum Limited (PPL) and Oil and Gas Development Company Limited (OGDCL) is at an advanced stage.
A senior government official told Dawn on Tuesday that the Planning Commission had also advised the government to simultaneously focus on energy conservation and use of alternate and non-traditional sources of energy to meet growing needs of a vibrant and growing economy. For this, the commission had called for a comprehensive exercise on prioritization and development of various competing forms of energy.
When asked if this meant Planning Commission’s opposition to the sale of PSO, OGDCL and PPL, the official said the planning commission had submitted its views on energy security in writing to the government without mentioning any specific transaction. However, he said that the performance of state-owned entities could be improved through management contracts and better corporate practices.
He said that Pakistan’s current per capita energy consumption was as low as 14 million BTUs as against 92 MBTU of Malaysia and 34 MBTU of China. Similarly, total primary energy consumption in Pakistan at present is about 55 million tons of oil equivalent (MTOE) which is estimated to increase to about 80 MTOE by 2010, he added.
Pakistan’s development vision for an expanded economy, increased industrialization and improved living standards demand substantial amount of energy and the links between sustainable development and energy will require major efforts and well-designed policy for a long-term energy security, says the Planning Commission.
Under the country’s long-term Energy Security Plan approved last year, the primary energy consumption should reach 120 MTOE by 2015, 177 MTOE in 2020 and about 361 MTOE in 2030.
Pakistan currently depends heavily on its natural gas reserves for industry, power generation and commercial and domestic use which would start declining by 2010.
The Planning Commission was of the opinion that the development and introduction of new technologies and sources of energy (which are currently in experimentation phase) would need to be completed before the year 2030 to meet the “looming oil crunch”.
Pakistan expects that share of oil in primary energy consumption would increase from 18.5 per cent to about 30 per cent in 2030 although in terms of quantity this would increase from 15 MTOE to 67 MTOE by 2030.
Similarly, the gas consumption would increase from 25.5 MTOE to 162 MTOE in 2030 but its overall share would reduce from 50 per cent at present to 45 per cent. However, the share of coal energy has been targeted to increase from current 6.5 per cent share to 19 per cent and that of nuclear energy from less than one per cent to 4.2 per cent by 2030.
