Pakistan heavily relies on imported energy – petroleum oil and fuel gases – to run the economy. According to estimates, it meets around 70 percent of energy needs through imports. Energy imports comprise around one-fourth of the total import bill of the country. Pakistan imported energy fuels worth $5.17 billion, which was over 27 percent of total imports of $19.04 billion in first four months (July-October) of the current fiscal year, according to the Pakistan Bureau of Statistics. Imported crude and refined petroleum products make 82-83 percent of Pakistan’s total consumption. Domestic crude oil production is 33 percent of the total crude used in Pakistan. Imported gas is approximately 15 percent of indigenous gas production. Pakistan paid $4.3 billion for the crude oil imports and over $2 billion for gas (LNG) in FY2018.
Pakistan is a promising market for oil and gas exploration. Some of the challenges that E&P sector faces in Pakistan are:
- Formulation of policy for exploration of unconventional hydrocarbons and competitive alternate fuels.
- Lack of commitment level, technology and financial resources for enhancing country’s energy security.
- Sustained growth of indigenous petroleum reserves and indigenous supplies to control the huge import bill.
- Introduction of reforms in power sector and mass-transit schemes.
Oil & gas terminals at Port Qasim:
Pakistan has started the process of expanding infrastructure for international trade as it is developing a secondary ship navigation channel and establishing terminals for oil and gas imports at Port Qasim, Karachi. At present, Port Qasim has 12 import and export terminals for coal, refined petroleum products, liquefied petroleum gas (LPG), liquefied natural gas (LNG) and other bulk and containerized terminals. This new development will help the country meet growing demand for imports and exports in the near future as anticipated expansion in the economy over the next two to three years will require extensive infrastructure.
Pakistan International Bulk Terminal Limited (PIBTL), the only authorized terminal in the country to facilitate commercial coal importers, has initiated the process of adding the LPG import facility at Port Qasim. Engro Corporation, which built the first LNG terminal in 2015, is working on plans to add one more terminal of 4.5 million tons per year in 2019, in collaboration with Royal Dutch Shell, the Fatima Group and trading house Gunvor. Energas LNG Terminal Private Limited is also in the race to establish LNG import infrastructure at Port Qasim with the capacity of six million tons per year. It is awaiting the allocation of a suitable site at Port Qasim. Energas LNG is a consortium of gas buyers in the private sector comprising of Younus Brothers, the Sapphire Group and Halmore Power.
Chuanqing Drilling Engineering Co. Ltd:
CCDC being one of the largest drilling companies in Pakistan is intending to further invest in and modernize oil and gas sectors of Pakistan. CDCC would like to diversify its operations in Pakistan and would introduce CDCC’s equipment and machinery to Pakistan’s companies. This would open up more robust business opportunities for Chinese and Pakistan’s companies.
After a gap of nearly three decades, ExxonMobil is gearing to re-enter the Pakistani market, as the world’s largest oil and gas company eyes it as an emerging economy with immense potential. ExxonMobil has made major strides to re-enter the Pakistani market, which included acquiring a 25 percent stake in offshore drilling in May this year. The first exploration well is planned for January 2019. Previously, Italian energy giant ENI, Pakistan Petroleum Limited (PPL) and Oil and Gas Development Company (OGDC) held 33 percent share each in offshore drilling in Pakistan. Also, ExxonMobil in partnership with Pakistani consortium Energas is planning to build Pakistan’s third import liquefied natural gas (LNG) terminal. With the success of these projects, the company could provide employment to hundreds of Pakistanis and give technical training and global best industrial practices.