GROWING SECURITY CONCERNS THREATENING FOREIGN INVESTORS
MARAMZAI FIELD SUSPENDS PRODUCTION AT TAL BLOCK
Jan 24 - 30, 2011
Growing security concerns in the energy rich areas like Balochistan and Khyber Pakhtunkhwa are not only a serious setback to the development of energy resources, but also shattering the confidence of the foreign investors in the backdrop of unabated law and order situation and rising acts of terror by the unknown militant groups.
In one of recent incidents of violence, six persons were killed and few employees were kidnapped by unknown miscreants in Kohat. The incident forced the operators of Maramzai field to shut down production last Friday following violent attacks and kidnapping of some of the staff members of the company by unknown militants.
It is important to mention that Tal block contributes heavily to Pakistan's oil and gas production estimated at 8 per cent of gas and 13 per cent of oil. Lower oil production risks higher oil import bill. Similarly, the government is already facing significant shortage of gas estimated at 25 per cent of total demand due to peak winter season.
As far as Maramzai field was concerned, it is the fourth discovery in Tal block, which started production on January 3 with 40mmcfd of gas and 1650bpd of oil volumes.
Sources said that POL, PPL and OGDC drive 43 per cent, 18 per cent and 9 per cent of sales from Tal block. Although the time period of shut-in is not confirmed as yet but likely to be contingent on beefing up of security by the government in the area. The closure of the production would naturally have serious fallout when the energy sector is already under acute pressure due to short supply of gas.
In the wake of the attack on drilling and servicing staff engaged by MOL in Tal block, at least six persons including two employees of MOL were killed last evening while the attackers had also managed to kidnap two employees. The concerned company has rightly demanded of the government to ensure security of the people working with the company before they resume production activity at the field.
In fact such unfortunate incident poses risk to production and ongoing exploration efforts in Tal and surrounding block, Nashpa, operated by OGDC. Noteworthy exploration activity in Tal block includes Makori East and Tulang.
If the security concern persists it is bound to have a negative fallout on ongoing exploration activity in the country. Such incidents in future will have an impact on both POL and PPL due to attacks on high-pressure gas pipe line from Sui gas field.
Meanwhile, management of MOL with profound grief announced the death of six persons including four FC guards, one contractor driver and one local labor as its convoy was ambushed by unknown miscreants on way back to Central Processing Facility (CPF) from Maramzai site well around 4:30pm in the evening on Thursday last. The miscreants also abducted two people one driver and one specialist from contractor as one guard sustained injuries when firing ensued.
MOL Pakistan immediately suspended the production operations from the Maramzai well due to security concerns resulting in suspension of 40 mmscfd gas and 1600 barrel oil per day production and withdrew all personnel from the well site forthwith in order to avoid any further human loss.
Mr. Janos Feher, managing director of the company in his condolence message to all company employees and bereaved families expressed his shock and profound grief over this unfortunate development with a message "We all wish we could undo what happened and bring those back who embraced martyrdom in the line of duty."
The managing director stated a strong demand has been put forward to the federal and provincial government to provide safe and secure working conditions and requested the government to take all necessary measures for the timely release of abductees.
GAS SUPPLIES AT RISK
In yet another act of sabotage, some unknown miscreants destroyed a high pressure gas pipeline linked with Sui gas field which is the second incident of damaging a high pressure gas pipeline with in a period of last ten days time. All these acts of violence clearly expose the nefarious designs of the anti-state elements involved in acts of insurgencies to aggravate energy crisis to paralyze the economy of the country.
In the present scenario when the economy is confronted with the worst kind of energy crisis due to short supply of gas and rising cost of fuel oil and other gasoline products destroying supply lines or attacking the gas fields, it is a matter of serious concern and should be dealt with an iron hand by bringing the culprits involved in the national crimes to the justice.
Serious acts of insurgency occurred near Hajano village in the Tangwani area of District Kashmore about 34 kilometres downstream from Sui, South of the Sui gas field, close to the Balochistan and Sindh border.
As a result of the incident, 18 inch diameter SSGC gas pipeline was damaged. The incident was caused by an explosive device, causing a 6 feet deep trough and rupturing nearly 40 feet long pipeline in a tract of wet muddy land.
The pipeline was carrying 110 million cubic feet gas daily (mmscfd) from Sui gas field to SSGC's pipeline system at Shikarpur, for its onward transmission to the entire Balochistan. Subsequent to incident, the effected section was isolated immediately. At the same time, an emergency response team rushed to the site from Shikarpur to inspect the situation.
The immediate impact of the blast at the gas pipeline was a shortfall of about 30 mmscfd and that shortfall would naturally be passed on to the consumers by the gas distribution company.
The sabotage activity against the gas supplies took place just within ten days as the last blast occurred on the same gas pipeline near Jafarabad. Such sabotage incidents occurred at the same place i.e. 'Tangwani' area.
Such acts of violence and sabotage was clearly against the interest of the people either in Balochistan or elsewhere in the country resulting adverse impact on the economy besides too many hardships for the people in general especially during extremely cold weather.
Some serious thoughts and practical steps are needed on the part of the government to restore the confidence of the investors as well as to ensure smooth economic growth with uninterrupted energy supplies.