ISLAMABAD: As top public-sector producers viewed the country’s shale gas potential economically unviable in given conditions, Prime Minister Shahid Khaqan Abbasi considered imported gas the only way forward to meet energy needs.

Speaking at the inaugural session of the Pakistan Oil and Gas Conference on Thursday, the prime minister said the PML-N government had effectively tackled the energy crisis that compromised economic growth for many years under the previous governments. He said gas loadshedding was now a matter of the past. Electricity loadshedding will also come to an end shortly, he added.

The conference was informed that Pakistan Petroleum Ltd (PPL) and Oil and Gas Development Company Ltd (OGDCL) had reservations about the economic feasibility of shale pilot project in view of low oil prices and the high cost of exploration, drilling and production.

“Both companies are reluctant to start shale pilot projects, but we are pressurising them to undertake the exploration,” said Gas and Petroleum Concessions Director General Qazi Muhammad Saleem while responding to a question.

In his presentation, Mr Saleem said a study by the United States Agency for International Development (USAID) recommended undertaking pilot projects to determine the exploitability of these huge shale gas resources and their conversion into reserves.

He said the pilot project has to determine and confirm actual productivity of shale gas reservoirs to chalk out the conceptual commercialisation and muster the required technologies for the development of these strategic assets.

Mr Saleem said China has already explored four billion cubic feet per day of shale gas. He said the United States was currently leading shale gas production while Pakistan lacked that kind of technology.

The prime minister said it was unfortunate that the oil and gas industry in Pakistan had failed to propose solid objective solutions to meet energy-sector challenges and instead the government was coming up with new ideas and solutions.

He said the import of liquefied natural gas had helped the country adequately meet its energy needs, and asked for objective intellectual input for the optimal use of renewable sources of energy.

He recalled that Pakistan faced a plethora of challenges, like a severe shortage of electricity, gas and CNG for the transport sector, when the PML-N came to power in 2013. But now with the import of LNG, the country exported 700,000 tonnes of fertiliser instead of importing millions of tonnes every year. “Today, all gas consumers, particularly the industrial sector, are getting uninterrupted supply, while imported gas is also being used to fuel power houses at cheaper rates.”

He said the country would soon have three LNG terminals that would pump gas across the country and help meet future needs of its domestic and industrial users. “Today, things are moving forward. We have new reserves, oil production has increased to 100,000 barrels per day, which is substantial, but still not enough,” the prime minister said.

He said Pakistan was the only country that was using the RON-87 type of fuel, and it took an effort to convince the industry to switch over to the higher Euro-grade RON-92, which was being used across the world. Similarly, the country switched to Euro-II diesel that was less damaging for the environment and the CNG sector had been deregulated.

He said two oil refineries of 250,000 barrels per day capacity were operational in south and central Pakistan while plans were afoot to pump petrol and diesel upcountry through the pipeline to cut down the cost and time through road transportation. He said oil tankers would continue to provide services for further distribution across the country.

He said the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline was finally taking shape and would be operational in around four years. The Iran-Pakistan gas pipeline was stuck up due to international sanctions, he said.

The prime minister said natural gas was the cheapest mode for power generation. He said he had directed to put an end to the use of diesel for power generation as it was way too expensive. He said the world had also stopped the use of furnace oil while Pakistan was still using it to produce 8,500 megawatts of electricity.

He said Pakistan was also using imported coal to some extent for power generation, noting that it would take a while before the country could use Thar coal. He said the cost of power generation through wind and solar was coming down. However, there was a need for more studies to ensure its optimal use, he said.

“Miracles do not happen... it is the willingness to change that makes the difference,” he said. He said local companies should deliver and added that the government was not interfering in their working.

Published in Dawn, November 3rd, 2017