Govt plans to take steps to increase gas supply, reduce its demand.

ISLAMABAD -- To increase the gas supply and reduce its demand, the government is planning expediting the process of entering into fresh long-term LNG import contracts and gas prices rationalisation through parity between gas and electricity rates, which will encourage gas consumers to switch to electricity.

The proposals were made during a meeting to discuss 'Pakistan Natural Gas: Policy Issues and Way Forward' organised by Integrated Energy Planning (IEP), Ministry of Planning, Development and Special Initiatives (M/o PD and SI) here. During the meeting, the stakeholders suggested that at present, the development of gas storage infrastructure is not financially viable for the country, instead option of trading LNG at the lowest spot market rates could be considered, which is globally becoming a popular concept. It was then suggested that instead of opting for an expensive subsurface (depleted reservoirs) gas storage option, gas storage over the surface (salt caverns) could be considered which has lower cost implications. Therefore, a feasibility study may be conducted to identify the cost and areas for such storage.

The meeting was attended by Chairman Energy Task Force, Shahid Khaqan Abbasi, Planning Minister, Ahsan Iqbal, Minister for Power, Khurram Dastagir Khan, representatives of different energy sector organizations including Oil and Gas Regulatory Authority (OGRA), Directorate General of Gas, Pakistan LNG Limited (PLL), Interstate Gas System (ISGS), Oil and Gas Development Company Limited (OGDCL), Central Power Purchasing Agency (CPPA-G), Sui Northern Gas Pipelines Limited (SNGPL), and Sui Southern Gas Company Limited (SSGC).An overview of the present status of production, import, and supply of natural gas in the country was discussed, followed by recommendations to improve the gas supply and demand through short-term and long-term policy interventions aimed at different levels. During the briefing it was informed that production of natural gas has declined to 3,505 MMCFD in 2021 compared to 4,063 MMCFD in 2010.

Due to depleting local gas resources, the balance recoverable reserves reached the level of 20,951 Billion Cft in 2021. The depletion trend projects that natural gas production will shrink to 2306 MMCFD by 2030. The demand kept growing at a consistent pace although government banned new connections in 2011 except residential/special commercial (roti tandoor) connections. The growth in the residential connection was not...