Oil & Gas is life line of any economy. Oil & Gas producing countries have become advanced states with higher per capita. Although Pakistan is rich in Oil & Gas resources yet the import lobbies and commission agents have kept it poor; forcing it to carry the begging bowl. Import of Oil & Gas is the largest reason of dollar drain and free fall of Pak Rupees. Pakistan imports $16 to 20 billion annually but if this drain of dollars is replaced with indigenous Oil & Gas then Pakistan does not have to beg IMF, China, UAE or KSA and dollar will free fall to Rs 30 from Rs 160. This will cause reduction in prices, better education, creation of jobs, enhanced exports and improvement in quality of life. With $16-20 billion in hands the destiny of Pakistan can be turned around in 4 to 5 years; with some $8 billion of forex saved by 2021.
Of course, Pakistan needs to make investor friendly policies in the hydro, solar, wind and alike alternate and renewable energy resources to have these asap, yet let there be no doubt that without oil and gas, our economy would be in shambles – atleast till 2040. The World Energy Outlook by international agencies, including world institutions of repute like International Energy Information Agency (IEIA) in high clarity has given a verdict that atleast till 2040 the world as a whole and developing nations specially will remain highly dependent on Oil and Gas.
[box type=”shadow” align=”” class=”” width=””]Pakistan has all the ingredients to be self-sufficient in oil and gas within the tenure of this Government. Thus, causing free fall of $ to Rs 30. Gas average sale price can be halved; increasing exports, jobs, GDP.[/box]
Pakistan has tremendous Oil & Gas resources which is one pre-requisite to self- sufficiency. Pakistan is estimated to have Oil & Gas resources:
- Oil 27 billion barrels.
- Gas 150 Trillion Cubic Feet TCF (i.e. 15 times of Sui size).
- Shale Gas 550 Trillion Cubic Feet TCF (i.e. 50 times of Sui size).
In financial terms, at 75% recovery factor and import parity price prices the value of Oil & Gas resources is estimated as follows:
- Oil: 27 billion barrels x 75% x $50/barrels = $ 1 trillion.
- Gas: 150 TCF x 75% x 920 BTU/CFT = 100,000 trillion BTU = 100 billion MMBTU x $10/MMBTU = $ 1 trillion
- Shale Gas: 550 TCF x 35% x 920 BTU/CFT = 175,000 TCF BTU = 175 billion MMBTU x $10/MMBTU = $ 1 trillion
In short, Pakistan has recoverable oil and gas resources worth $3 trillion or $120 billion per year for next 25 years. Plenty to off-set all petroleum imports for next couple decades and bring prices of petrol, diesel, jet fuel considerable low and gas down by half. We need to get off the LNG fever and get on the indigenous fever.
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Present, annual indigenous production and consumption are as follows:
- Oil consumption is 500,000 barrels per day (182 million barrels per year), while indigenous production is meagre at 85,000 barrels per day (31 million barrels per year), low at 17% only.
- Gas constrained demand is 4,500 million cubic feet per day (1.6 trillion cubic feet per year) while indigenous production is 3,900 million cubic feet per day (1.423 trillion cubic feet per year).
- Gas unconstrained demand is estimated at 8,000 million cubic feet per day.
Pakistan can easily produce 1 million barrels of oil per day (and 2 million barrels per day with concentrated efforts) and 8 billion cubic feet per day; thus not only getting rid of the menace of electricity & gas load shedding and low pressure but putting GDP into double digit increase and saving $16 to 20 billion of foreign exchange.
[box type=”shadow” align=”” class=”” width=””]Pakistan has $3 trillion worth of Oil/Gas. Why wait?[/box]
All the necessary ingredients exist in Pakistan those are necessary for production of Oil & Gas, i.e. vast proven petroleum system, seepages (very few countries have this blessings), sedimentary basins, right source rocks, traps, seals, opening of FATA, generous petroleum policies, accurate petroleum rules and a willing government.