Petroleum Division plans to revive gas pipeline projects

Published: January 9, 2019
Will seek ECC’s approval for laying Gwadar and North-South pipelines. PHOTO: FILE

Will seek ECC’s approval for laying Gwadar and North-South pipelines. PHOTO: FILE

ISLAMABAD  : The Petroleum Division is going to seek government’s approval for an integrated strategy to revive abandoned multibillion-dollar gas pipeline projects in a bid to address energy shortages.

Sources told The Express Tribune that the Petroleum Division was set to present three options to the Economic Coordination Committee (ECC) to decide the fate of old gas pipeline projects in order to ensure energy security in the country.

Under the first option, the Petroleum Division wants the ECC to revive the Gwadar-Nawabshah LNG Terminal and Pipeline project under the integrated strategy for gas import and infrastructure. The project will provide infrastructure and liquefied natural gas (LNG) supplies. It may also be extended to the Iranian border in future for gas purchases from the Gulf country.

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Under the second option, the Petroleum Division will seek approval for phase-wise capacity utilisation of the North-South gas pipeline project in case it is considered a standalone project, which will be connected with upcoming private-sector LNG terminals at Karachi port under third-party access rules.

Under the third option, the Petroleum Division is set to ask the ECC to either defer or drop the North-South gas pipeline project.

Sources recalled that during the previous Pakistan Muslim League-Nawaz (PML-N) government, the ECC had approved on October 2, 2014 implementation of the Gwadar-Nawabshah LNG Terminal and Pipeline project as an alternative to the Iran-Pakistan pipeline project, which had been stalled due to international sanctions on Tehran.

“The Gwadar terminal and pipeline project had been designed to meet growing energy needs of Pakistan and ensure strategic diversification of gas infrastructure, which could also be extended to the Iranian border,” an official said.

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Under a revised strategy approved by the ECC, it was planned that the pipeline would transport up to 600 million cubic feet of re-gasified LNG per day (mmcfd) in the first phase and would be connected with the North-South gas pipeline at Nawabshah for onward supply to the Sui Northern Gas Pipeline’s network near Kasur.

In the second phase, the gas transmission capacity of the Gwadar pipeline would be enhanced up to 1,500 mmcfd with the addition of Iranian gas, if it becomes available.

Despite considerable progress on the Gwadar project, which included approval of the Executive Committee of National Economic Council (Ecnec) and finalisation of the project price by the price negotiation committee, the Cabinet Committee on Energy directed the then ministry of petroleum on June 6, 2017 to drop the scheme.

Overall, three gas import and infrastructure projects formed the integrated strategy and they were inter-dependent on each other to meet energy needs of the country.

However, the officials said that the abandoning of the Gwadar pipeline project had resulted in loss of gas resources for the North-South pipeline.

In such a scenario, the Petroleum Division will ask the government to come up with a policy decision on revising these pipeline projects.

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