Federal Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi has said that the gas consumers in Punjab will face serious gas crisis in upcoming winter season and domestic consumers will face about 7 hours gas load shedding.

During the peak winter months the gas demand in Punjab will reach to 950 Million Cubic Feet per Day (MMCFD) against supply of 650 MMCFD and the government has to resort to gas management, the minister said while addressing a press conference here on Thursday.

Flanked by the State Minister for Petroleum Jam Kamal Khan and Advisor on Petroleum Ministry Zahid Muzafar, Khaqan Abbasi said that under the gas management plan the gas supply to the domestic consumers, in Punjab, during peak winter’s months will stay suspended for 7 hours. “As a result of huge demand/supply gap the government in winter will not be in a position to supply gas other than domestic consumers, even domestic consumers will face gas suspension from 10 PM to 5 AM,” the minister added.

Independent Power Plants (IPPs) and fertilizer will get only RLNG as currently local natural gas is being provided only to the domestic consumers. However he said that RLNG supply to CNG sector is linked with the availability of LNG as currently due to pipeline capacity problem the gas supply to CNG sector in Punjab was suspended.The minister said that country gas reserves are depleting and warned that if no new gas fields were discovered the existing gas reserves will be exhausted in next 12 to 15 years.

The minister said that in a new study undertook by Director General Petroleum Concession (DGPC) with financial support from United States Agency for International Development (USAID) the shale gas revised in place resources of the country stand at 10,159 Trillion Cubic Feet (TCF) against previous estimated resources of 586 TCF. The minister said that out of this an estimated 200 TCF of shale gas resources are recoverable against 105 TCF of previous study.

Abbasi said that the new study has put the shale oil resources at 2,323 Billions of Stock Tank Barrels (BSTB) of which technically recoverable resources are 58 BSTB and risked technically recoverable resources (potential) estimated at 14 BSTB. “The proven reserve of gas is 20 Trillion Cubic Feet while the oil reserves are 385 million barrels, “the minister added.

Replying to a question, regarding the regulation of Liquefied Petroleum Gas (LPG) sector, the minister said that the summary pertaining to the regulation of the sector is waiting for the approval of Council of Common Interest (CCI). He added that the Ministry has suggested the government to fix LPG’s domestic cylinder containing of 11.8 kg price at Rs 900 per cylinder. He said that Pakistan was a gas prone country and 48pc of country’s energy mix requirement is met through indigenous gas supply. Currently, the country is producing 4.16 Billion Cubic Feet per Day (BCFD) of gas, which is not sufficient to meet the ever increasing demand for natural gas in the country, he said.

Abbasi said that presently, there is a gap of around 2 BCFD of gas between the indigenous supply & constraint demand, adding that to bridge the gap, the government is making all out efforts to enhance the gas availability in the country. He said that for this purpose the government has adopted three prong strategy: (i) Import of gas through transnational pipelines, (ii) Import of LNG and (iii) to enhancement of indigenous gas supplies through extensive exploration activities. For this purpose government is not only focusing on enhancing conventional gas but has also provided incentives to discover & exploit unconventional gas resources like Marginal Gas, Tight Gas and Shale Gas.

Talking to reporters on the occasion DGPC Saeedullah Shah said that the US Energy Information Administration (USEIA) in April 2011 reported presence of 206 TCF Shale Gas in Place Resource in Lower Indus Basin out of which 51 TCF were technically recoverable. However, in June 2013, USEIA revised Shale Gas resource in Pakistan as 586 TCF in place out of which 105 TCF were tipped as risked technically recoverable and also included 9.1 Billion Barrel Shale Oil risked technically recoverable resource out of 227 Billion Barrel Shale Oil in place.

Saeedullah Shah said that to get authenticate Shale Gas Resources in the country, Shale Gas Study with financial support from USAID was initiated in January 2014. The study was completed in November 2015 with a total cost of $ 2.2 million. The study covered lower & middle Indus Basin which geographically spread over Sindh and southern part of Punjab & eastern part of Balochistan province. Total area under the study was 271,700 km2’ which constitutes 33pc of total sedimentary area of Pakistan. Under the study detailed analysis of 124 wells were carried out including laboratory analysis on Shale Cores and Cuttings in USA. The study has confirmed presence of substantial Shale Gas and Shale Oil as under:

In place resource: Free gas (TCF), 3,778, adsorbed gas (TCF), 6,381 Total gas (TCF), 10,159 and Oil (BSTB), 2,323 of which technically recoverable resource include free gas 188 TCF and Oil 58 BSTB. Risked technically recoverable resources are free gas 95 TCF and oil 14 BSTB.

Shah said that the study has further confirmed that basic technology required for Shale Gas Exploration i.e., horizontal drilling and hydraulic fracturing is available in the country and is being used for Conventional and Tight Gas Reservoirs. This will help in launching Pilot Projects. However, this needs to be scaled up for large scale shale operations in the coming days.

Shale Gas Exploration and Production is capital extensive about 10 times higher than conventional oil and gas.

It was informed that the first pilot project of the shale gas will be ready in next three to four months. “We are targeting two wells located in Sindh and it is hoped to be operational within next three to four months,” the official informed.

Khaqan Abbasi said that during past two and half years a total 227 wells were drilled which resulted in 65 new oil and gas discoveries, around 560 MMCFD of additional gas and 27,000 barrels of crude oil per day was injected in the system. For the first time in the history of Pakistan, domestic oil production has touched the highest level of 100,698 bbl per day of oil on 07.12.2014, the Minister maintained.

Moreover, the Government has also initiated actions against the non-performing E&P companies including those who were holding licences for the last so many years without any physical activity.