ISLAMABAD, Feb 25: Pakistan is estimated to face a natural gas shortfall of 3,600 to 6,000 million meter cubic feet per day (mmcfd) by the year 2020 if pipeline projects for its import are not materialized.
This has been revealed in a provisional report submitted to the ministry of petroleum and natural resources by private consultancy firm Hagler Bailly.
Pakistan’s oil import bill stood at $3 billion during the last fiscal year but is expected to decline by around 25 per cent during the current fiscal due to reduced consumption because of sluggish industrial activity and decline in international oil prices.
If none of the import projects materialized in the next five years, dependence on oil imports would go up proportionately and oil import bill is estimated to surpass $15 billion by the year 2020.
The report found that the country would have a total supplies of 3,034 mmcfd of gas in 2004 against a gross demand of 3,271 mmcfd leaving a shortfall of 237 mmcfd. By 2006, the shortfall would increase to 476 mmcfd as total supply is projected to be at 3,264 mmcfd against a gross demand of 3,690 mmcfd.
The firm was assigned by the government to prepare a study on gas demand and supply position so that it could formulate strategy on import of gas pipeline projects from Qatar, Iran or Turkmenistan.
Pakistan and Iran signed a memorandum of understanding to undertake a pre-feasibility of Iran to India overland pipeline. BHP, an Australian company, had completed a similar study a few years back on the Iran-Pakistan pipeline, has once again been assigned to prepare the pre-feasibility. Qatari oil minister is expected to visit Islamabad in next few days to speed up negotiations on Qatar to Pakistan pipeline.
Based on development of already discovered gas fields and projected future discoveries, the total supply of gas is estimated to increase very slowly, around 100 mmcfd per year, till 2008. The gas supplies would start declining at an average 175 mmcfd from 2008 to 2020.
The supplies will reduce from 3,381 mmcfd in 2009 to 1,567 mmcfd in 2020. Gross demand would keep on increasing at an average 200 mmcfd of gas and jump to 7,515 in 2020 from 3,015 mmcfd in 2004.
Even in the moderate GDP growth rate, gross demand would go up to 5,175 mmcfd by 2020 against conservative estimated demand of 2,997 mmcfd in 2004. The gross demand is based on transmission, distribution and compression losses at 8 per cent and decreased to 6 per cent by 2005. The losses are projected to remain constant at 6 per cent till 2020.
The firm gave a detailed presentation to petroleum minister around a week ago and based its study on two scenarios of high and moderate gross domestic product (GDP) growth rates.
The deficit is expected to increase from 237 mmcfd in 2004 to 591 mmcfd in 2007 and 775 mmcfd in 2008. The deficit will further increase to 1,053 mmcfd in 2009 and almost double to 2,456 mmcfd in 2013. The gas deficit would increase to 3,219 mmcfd in 2015, 4,785 mmcfd in 2018 and 5,947 mmcfd in 2020.
Under the moderate growth rate scenario, a surplus of 37 mmcfd to 43 mmcfd is expected to prevail during the period 2004- 06. However, deficit would start from fiscal year 2007 with a nominal 23 mmcfd and increase to 202 mmcfd in fiscal 2009. The deficit would further increase from 432 mmcfd in fiscal 2010 to 1,370 mmcfd in fiscal 2013. The shortfall would touch 1,954 mmcfd in 2015, 2,967 mmcfd in 2018 and touch 3,610 mmcfd in 2020.
