ISLAMABAD, Aug 28: An agreement for the purchase and sale of natural gas from the Zarghun South gas field was executed at a ceremony held here on Monday. The agreement was signed by managing director Sui Southern Gas Company Ltd (SSGCL) Munawar B Ahmad (buyer) and Lt-Gen (retd) Imtiaz Shaheen managing director, Mari Gas Company Ltd, the operator of Bolan joint venture (BJV) along with its partners Spud Energy (Pvt) Ltd, Government Holdings (Pvt) Ltd and PKP Exploration Ltd (sellers).

The Zarghun South gas field located 52-km northeast of Quetta had gas reserves of 93bcf discovered by BJV incurring a cost of $53 million during the exploration phase.

Marri Gas, being the operator of the gas field, estimated a cost of $47 million on its development to produce and supply pipeline quality gas to the SSGCL, which would construct a 64-km pipeline from the field to Quetta transmission system, at a cost of $15 million.

The proposed pipeline would traverse through the high mountainous range of Zarghun and would enable the SSGCL to bring additional volume of 20 million cubic feet (MCF) of gas per day to Quetta. To facilitate the laying of this pipeline, the BJV had agreed to contribute $4 million towards the pipeline cost. The completion of the project was estimated to be accomplished in two years.

The Mari Gas, the owner and operator of Mari gas field at Daharki had been supplying gas to industrial sector including fertiliser and power.

The company for the first time since its inception had stepped out to this remote area of Sibi district to set up a gas production, processing and purification facility for supply of pipeline quality gas to domestic consumers through the SSGCL.

Speaking on the occasion managing director MGCL said that the company had carried out significant exploration work in the province. It had recently made a gas discovery in Khost, as operator of the Ziarat Block along with its joint venture partner MND of Czech Republic and was operating two other blocks in the area i.e. Hanna and Harnai and had an appraisal and exploration plan of approximately $24 million on these blocks.

Speaking at the ceremony the SSGCL managing director pointed out that the agreement would add new volume of gas to the company's network and would especially benefit gas consumers in the province.