Major Gas Discovery in Pakistan’s Resource-Rich Balochistan Province

At present, Pakistan is primarily focusing on imported gas to bridge the shortfall due to the absence of major discoveries; The country produces around 4000 MMCFD (4 bcfd) of indigenous natural gas against demand of over 6000 MMCFD (6bcfd) — a shortfall of 2bcfd

SoDATA (South Data) — Pakistan may have found — after a gap of 15 years — one of the largest hydrocarbon reserves, with potential deposits of one trillion cubic feet with more drillings in the works by state-owned Pakistan Petroleum Limited (PPL) –which owns the discovery block.

Since 2000, no major discovery of hydrocarbon reserves were made for various reasons. A report says it was due to low wellhead gas prices and bureaucratic snags.

An expert says risk assessments at that time possibly outweighed all other matters as the country faced waves of terror attacks including in Balochistan.

Several companies like British Petroleum, Niko Resources and Malaysia-based Petronas also pulled out of the country due to small hydrocarbon discoveries, says the report.

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Now that there is almost 85 percent reduction in terror attacks, gas exploration in resource-rich Balochistan –where the discovery was recently announced –is considered a medium-to-low risk exploratory zone, according to an expert — the province hosts the multibillion dollar Pakistan China Economic Corridor (CPEC) whose southern gateway is the deep sea port of Gwadar on the Arabian Sea.

Last November, Army Chief Gen. Bajwa also visited Tehran with regional security and border fence on the agenda. Pakistan is reportedly well ahead with the 900-km long robust fence it is building along the Pak-Iran-Afghan porous border.

Report says Drill Stem Test (DST) of another well in Balochistan showed a flow of almost 11 million cubic feet of gas per day (mmcfd). It’s the first exploratory well in Margand X-1 block located in Kalat district of the province.

PPL has not yet announced the actual size of the hydrocarbon reserves in the block.

The previous government led by PML-N had prioritized on import of liquefied natural gas (LNG) instead of exploiting domestic oil and gas reserves specially in high risk areas.

At that time, former PM Khaqan Abbasi had said Pakistan has 20 trillion cubic feet of conventional gas… “Gas is enough to meet the needs for 15 years at the existing pace of production,” he said.

According to a 2015 report, Pakistan has massive deposits of 10,159 trillion cubic feet (tcf) of shale gas and 2.3 trillion barrels of oil. The revelation was made in a study conducted with the help of US Agency for International Development (USAID).

The demand-supply gap however remains — and is climbing — warranting the need for local exploration of conventional and shale gas, oil.

Pakistan produces around 4000 MMCFD (4 bcfd) of indigenous natural gas against demand of over 6000 MMCFD (6bcfd) — a shortfall of 2bcfd.

To meet demands, the country was primarily focusing on imported gas absent major discoveries.

The supply and demand gap is however expected to increase to the tune of 4,600 MMCFD (Million Cubic Feet per Day) in FY 2022-23 and 6,700 MMCFD by the FY 2027-28 without the imported gas, Oil and Gas Regulatory Authority (OGRA) said in its State of Industry Report 2017-18.

“Even if major discoveries are made, we’ll still be needing import of LNG as well as through cross-country gas pipelines”, the expert says.

Natural gas is a major contributing fuel in country’s energy mix having a share of 48 percent.

Power sector was the main consumer of natural gas during FY 2017-18, consuming 37 percent followed by domestic sector 20 percent, fertilizer 17 percent, captive power 10 percent, industrial sector 9 percent, transport 5 percent, and commercial sector having 2 percent share.