US offers to conduct, finance study on shale reserves in Pakistan

Published: May 29, 2016
This will be the second study that will cover areas left in the first assessment. PHOTO: AFP

This will be the second study that will cover areas left in the first assessment. PHOTO: AFP

ISLAMABAD: The United States has offered Pakistan assistance in undertaking and financing another study to assess the hidden and vast shale oil and gas reserves in the country, officials say.

The first study was conducted by the US Agency for International Development (USAID), but it did not cover some areas of Balochistan, Sindh and Khyber-Pakhtunkhwa.

Pakistan has accepted the offer for the second study for which the US will bear the entire cost.

Pakistan and the US have held a couple of meetings on forging cooperation in the energy sector over the past few years. The first huddle was held in 2014 which was followed by another meeting in April 2015.

Exploration: OGDCL attempting to meet energy needs

The third meeting of the series was held in Washington recently where the US expressed interest in conducting the second study to evaluate shale oil and gas deposits in Pakistan.

In the first assessment, USAID estimates showed that Pakistan had massive deposits of 10,159 trillion cubic feet of shale gas and 2.3 trillion barrels of shale oil – figures that were several times higher than those released by the US Energy Information Administration (EIA).

The USAID further revealed that risked technically recoverable resources were 95 trillion cubic feet of shale gas and 14 billion barrels of shale oil.

According to EIA assessment in April 2011, Pakistan had 206 trillion cubic feet of shale gas in the lower Indus Basin, of which 51 trillion cubic feet were recoverable.

However, in June 2013, it revised the estimate upwards to 586 trillion cubic feet, of which 105 trillion cubic feet were technically recoverable.

Apart from gas, the EIA also saw the presence of 9.1 billion barrels of shale oil that were technically recoverable out of estimated deposits of 227 billion barrels. In the first study, the USAID collected data of 1,611 wells and undertook shale formation of 1,312 wells through drilling. It used 70% of data to prepare the study and sent samples to the New Tech Laboratory in Houston for assessment.

First shipment of US natural gas to EU arrives

Though the technology is available in advanced countries for tapping the shale reserves, environmental concerns, requirement of a huge quantity of water and a high cost of drilling are the real challenges.

A well requires 3 to 8 million barrels of water. Pakistan has water supplies, but the real issue is its disposal.

Estimates suggest shale gas will cost $10 per million British thermal units, which will come down with the increase in recovery of untapped reserves.

The government will frame a policy for shale deposits after the cost of drilling is determined and the second study is conducted.

Published in The Express Tribune, May 29th, 2016.

Like Business on Facebook, follow @TribuneBiz on Twitter to stay informed and join in the conversation.

Facebook Conversations

Reader Comments (15)

  • Ahmed
    May 29, 2016 - 12:26PM

    Another spy operation with a USAID cover.Recommend

  • Basit
    May 29, 2016 - 12:58PM

    Excellent opportunity for CIA to embed with their study groupRecommend

  • May 29, 2016 - 5:17PM

    Shale is not good for Pakistan. Pakistan is already located in high seismic region, Shale exploration/drilling will further increase the risk of earthquakes. Recommend

  • Bilal Hussain
    May 29, 2016 - 6:55PM

    Another spy game. Cover operation.Recommend

  • Abu Norr
    May 29, 2016 - 7:40PM

    Why cant we take things on face value? A stable Pakistan and economically well-off Pakistan is in the best interest of all regional power centres. That is the only way which will make Pakistani a capitalist country …away from radicalism…and that’s what US and rest of the world want….We should stop thinking on these “conspiracy theories” and let us focus on economic development of Pakistan…Recommend

  • eddied
    May 29, 2016 - 7:42PM

    The USA offers to donate its technology to help Pakistan understand the nature of the resources the country may have available on its soil… but typical stupid Pakistani fools see this only as an attempt to spy on you?… the uneducated mullahs have brainwashed people with so much hate for the west… and that is holding you back from developing what you have like a modern country in 2016…your own ignorant religion/political establishment is your biggest problem to overcome..’Recommend

  • Naeem
    May 29, 2016 - 8:28PM

    Please say yes, (and thank you) this is no spy operation.

    Make the report available/Publish online. this is government spending, should be available.

    Technology to recover shale reserves is now available at cheapest rates ever, best time to lock in some ToT deals. Please move fast and don’t waste another opportunity.Recommend

  • Mr Obvious
    May 29, 2016 - 9:26PM

    @Basit: @Ahmed: A simple thank you would be more appropriate.

    Most Pakistanis don’t realize it was the USA who identified/surveyed your coal deposits, provided your first nuclear reactor, was sole supplier of your high tech weapons for decades, setup your air force academy, provided bomb disposal training/equipment, provided the technology/equipment to identify power theft, provided $30 Billion in aid. And despite being treated like trash by Pakistanis like you they still provide assistance. BTW – anybody else offer to help you on developing shale? Anybody on the planet know more about developing shale deposits than the USA?Recommend

  • Harry
    May 29, 2016 - 9:31PM

    Why such a sudden urge to help Pakistan find oil, and in Baluchistan particularly; Pak army should take a notice immediately as politicians can’t be trusted. Recommend

  • Bubu
    May 29, 2016 - 11:04PM

    There is no such thing as a free lunch. Recommend

  • FAZ
    May 30, 2016 - 11:18AM

    @Mr Obvious:
    Obviously these are the famous bloggers across the borders! Chill out man! Recommend

  • azhar
    May 30, 2016 - 11:33AM

    As per news reports last year, PPL & OGDCL had started drilling of country’s first ever shale oil/gas well in Sindh. What has been the progress as Pakistan is in huge energy crises. Whatever that could be taped should be ASAP. Recommend

  • Sued Shah
    May 31, 2016 - 3:26AM

    Thank you for your help. ..USA….ignore the Indian comments here. Recommend

  • Javed
    May 31, 2016 - 8:44AM

    @Zafar Bhutta author. Please correct article numbers about water usage per well 3 to 8 million bbl absolutely wrong. Max water per well 20,000 m3 or 168,000 per well. Hydraulic Fracturing or Fracking is wine wine story for both US (technology add) and Pakistan ( 1/2 of our import is HC). The biggest challenge is security and investment and willingness in Pakistan Oil and gas industry (national plus international). In Fracking once trends and new wells are online it becomes cheaper to exploit initial wells are risky. Remember each hydrocarbon play is unique needs time. Up to now only Polish oil and gas company Pakistan has one well success. So in short government special OGDC and PPL as biggest player should take practical steps, at least 4 wells per year then they can cash it simply land sale. Our east neighborhor India is far active in it. Enviroment challenges are there but really manageable. Government, OGDC, PPL do something for Unconventional Oil world (don’t just frac existing wells) to increase home grown production, jobs and reduce import bill of Pakistan. Recommend

    Jun 1, 2016 - 10:13AM

    @ eddied

    Are you unaware of the history?
    Why the come an support for such activities?

    They have their own interest.

    Did you forget what happened in Polio drop case, it was also the project of similar donor.

    Think outside the box, Here we are brainwashed by educated people in similar manner!Recommend

More in Business