UNEXPLORED ENERGY RESOURCES OF SINDH

TARIQ AHMED SAEEDI
(feedback@pgeconomist.com)

Apr
5 - 11, 2010

It is an often-repeated statement that Pakistan is a natural resources-rich country. This repetition however does not belie the reality proved by many local and international surveys and reconnaissance done to have found out vast mineral deposits under the plains of the country.

The local and international companies have presented estimates about the variety and immensity of reserves of valuable metals as well as energy sources such as oil and gas.

So far, the direction of discoveries is confined to exploration of oil and gas while other mineral resources and alternative sources of energy are still untapped. Such projects are capital intensive and also suffered from political expediency. Similar is the fate of energy generation sites and projects, which could not come to the surface sometimes because of interest foreign countries crave for in Pakistan. Apart from exploration activities, this war of interest looms large in the development and construction projects of strategic importance. Gwadar Port is a befitting example of victimization by the commercially ruthless foreign hands and internal political bickering. The port was constructed by Chinese engineers and that later was handed over to Singaporean port authority for governance that also failed for whatever reasons to bring the Gwadar port in to operation. The province has abundance of natural resources including oil, a driver of foreign voyages from overseas. According to various estimates, the province has unexplored mineral deposits in plenty across the province. Once turned in to useable energies, these minerals can bring overnight socioeconomic developments in the underdeveloped province.

Several energy projects in Sindh also became victims of such external and international interventions. World Bank refused to loan coal extraction in Block 5 of Thar since it detected reportedly some kind of environmental unfriendly contents in the local lignite. The province of Sindh has vast deposits of minerals. However, mining activities in the province are confined to industrial and construction minerals. Coal is not the only non-renewable mineral resource in the province. The province also contributes substantial shares in the oil and gas parcels of the country. Sindh's contributions in total oil and gas production in the country are estimated at 56 per cent and 72 per cent respectively. Oil and gas are produced in its fifteen districts: Qambar-Shahdadkot, Hyderabad, Khairpur, Dadu, Badin, Thatta, Tando Allahyar, Tando Mohammed Khan, Jamshoro, Ghotki, Matiari, Sanghar, Kashmore, Jacobabad, and Shikarpur. The province produces daily 67,140 barrels oil and 3.99 billion cubic feet gas.

Wind energy is used in most of the developed countries to reduce reliance over fossil fuels for power generation. Sindh's port city Karachi has long coastal belt with an ideal wind corridor that can generate wind electricity in enormous volume.

National mineral policy defined in details the investment and working modalities for mining companies operating in the country. In addition, it categorized the variant rules and regulations at provincial levels. It covered environmental, social, economical aspects of projects outlining for example the license acquiring procedures for local as well as foreign companies. Besides, it discussed in details the incentives and taxes applicable to foreign and local ventures. In spite of this, the policy document has been outdated since it was formulated in 1995. It is clear that how difficult it would be for new projects to take guidance from an old document. Above all, the royalties that should be an entitlement of a province from where minerals are extracted, need revision. Stranglehold of central-run gas bellwethers PPL and OGDC on Sindh's oil and gas comes under the criticism more often of leaders who want realignment of authorities that control provincial wealth.

Exploration of natural resources can bring revolutionary changes in the lives of masses and elevate the status of the country from an energy-deficient to energy-efficient in a short span of time. Besides, development of minerals sites can boost up the economic growth manifold. The deposits in Sindh are not only of immense export value but also can run the wheels of many local industries; can give birth to new small industries.

A neglected aspect in exploring oil and gas is public. People of the areas where reserves estimated to be in large quantity depend on few traditional occupations to earn livelihoods. Uninterrupted exploration works can generate new employment opportunities for them. Exploration is expected to shower benefits to the local population through creating reasons for infrastructure developments and making available basic amenities to local population. Critics however call for a tight regulatory framework to keep hold on slips in community participation of companies. According to a news report, some residential settlements of Thar fulfil their fresh water needs by handmade rainwater storages. No rain or rain both mean for them death and epidemic of lethal ailments because they drink contaminated open-air water. Social and economic betterment of the locals can mitigate the unnecessary costs of importing workforce from other countries. It is callous on the part of oil and gas exploration companies that ignore the miserable conditions of people while sucking the commodities from the nearby areas. Operating within wrecked settlements and from the barricaded stronghold, the foreign companies are frequently lambasted for their indifference to sighted destitute and impecuniousness of local communities around them. Sometimes, they do not even make up for the loss they mete out on local population through oil and gas drilling. Exploration on offshore fields has choked the livelihoods of the fishing communities of Badin and other coastal areas. The government should also bound exploration and petroleum companies to invest certain portions of their profits for the rehabilitation and uplift of local communities. Sindh is rich in resources and all stakeholders that include local community must divvy up the windfalls.