Islamabad - Expressing dissatisfaction with the current pace of discoveries in the petroleum sector, participants at a petroleum conference, held on Wednesday, observed that gas discoveries made during the past five years could meet the country’s gas demand only for three days.

Speaking at ‘Pakistan Oil & Gas Conference’ held here under the theme, ‘Roadmap for a Sustainable Energy Future,’ CEO of the state-owned Pakistan Petroleum Limited Wamiq Bukhari said, “The claims made about gas reserves in Badin are hollow, as there is a very small quantity of gas in them.” He added the companies had to look to the frontier regions to fulfill the energy requirements. The conference was attended by the government officials, seniors of private companies as well as oil and gas experts.

The conference was also informed that Pakistan was not maintaining 45 days of Strategic Oil Stocks, mainly due to the absence of policy on strategic storage in the country. Federal Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi said on the occasion there was no fix to the economic situation of the country, except by resolving the energy crisis.

“The only cost effective and quick solution to the energy crisis is Liquefied Natural Gas,” he opined.

“Some so called energy experts think the energy crisis could be solved by using cow dung or nuclear energy. I must tell you that neither the cow dung nor the nuclear power is the solution,” Abbasi maintained. He said that around 50 percent of Pakistan energy was based on gas, followed by oil, hydel and nuclear.

“Hydel and nuclear both are time and money consuming, while the LNG based power plants are easy to develop,” he said, and claimed, “We will wipe out most of the energy related issues from the country by December 2017.” “Besides that, the RLNG based power plants are more efficient as compared to the oil based power plants. The generation capacity of oil based power plants is 22, 35 and 40 percent, while the RLNG power plants generation capacity is 62 percent,” he elaborated.

“It is a crime to operate the oil based power plants,” the minister said emphatically. He pointed out it was only due to LNG that the textile, fertiliser and the dying CNG sector had become operational again

“Today we are thinking of exporting the fertilisers,” he said, adding, “It is the real economics, as on one hand we are importing LNG and on the other, we are exporting our value added products.” He said there was a huge demand for LNG, and people were asking for it. Abbasi further said that more gas was produced in the country than actual discoveries.

“We are asking the private companies to come forward and take the initiative. If they don’t, then we will do it through the government owned companies,” the minister clarified. He added that only two countries, Pakistan and Somalia, were currently using RON 87 fuel. Regarding diesel, Abbasi called for improving its quality, and asked the refineries to concentrate on Furnace Oil production. He informed that, after China, Pakistan was the second largest importer of the Furnace Oil.

Earlier, Federal Minister for Planning, Development and Reforms Ahsan Iqbal, while addressing the conference, said that besides road networks, under the China-Pakistan Economic Corridor (CPEC), the country would have an energy corridor. He said that petrol chemical plants would be installed at Gwadar, which would cater for the requirements of the entire region. State Minister for Petroleum and Natural Resources Jam Kamal Khan said the government would definitely try to resolve the issue of strategic reserves.

Talking about the oil storage, CEO, Oil Companies Advisory Council (OCAC) Ilyas Fazil said the current storage maintained by the companies was enough for only 14 days. “The oil companies are enhancing their storage capacity, but are asking the government to increase their margin, so that they could get back their investment,” he added.

Regarding strategic reserves, he said that these varied, as per government policy. “In every case, the responsibility for maintaining strategic stocks resides with the governments, with the industry cooperating for the implementation of the policy,” he informed.

He said that a few years back, a study was conducted on the strategic oil reserves of Pakistan, in which the strategic oil stock for 45 days was proposed for the entire country. “But the recommendation was not implemented,” he regretted, and added, “The fact remains there is still no policy for strategic oil storage in Pakistan.”

He proposed constituting a working group by MNPR, at earliest, to evaluate detailed options for strategic oil storage.

Pakistan Petroleum Limited (PPL) Chief Executive Officer Wamiq Bukhari said that Pakistan was at number 142 in terms of per capita energy usages.

“We are still consuming 4 or 6 MMCFD of gas, but compared to the developing countries, Pakistan must plan for a demand of 16BCFD,” he asserted.

He said Pakistan population doubled after every 23 years “If this trend continues, we will be 80 million in the next 40 years,” he predicted.

“We are still talking about 22000 to 25000 MW of electricity generation but on the hand, Brazil, with the same population, is consuming 120000 MW of electricity,” Bukhari added.

He said Pakistan still followed the historical based forecast for gas demand. “By following this forecast, we will never enter the list of developed countries, and will always stay underdeveloped,” he warned.

The daylong conference adopted the following recommendations: Integrated Energy Plan for Pakistan, Regulatory Reforms, CPEC Security to be extended to the oil & gas industry, Fuels Specs RON 87 to 92 and Euro II standard, Deregulate LNG imports, Deregulate Petroleum Margins and IFEM, Gas Companies- Smaller Distribution setups and Fast-Tracking Additional LNG Projects.