Govt to offer 35 offshore sites for oil, gas exploration

Published: November 30, 2019
Email
A Reuters representational image.

A Reuters representational image.

ISLAMABAD: Pakistan has decided to auction 35 offshore sites next month for drilling to find oil and gas reserves in a major move to step up hydrocarbon production and meet growing demand.

The decision came after public-sector companies including Oil and Gas Development Company (OGDC), in a joint venture with Italy’s Eni and US energy giant ExxonMobil, made efforts to discover oil and gas deposits at an offshore site in the Arabian Sea near Karachi. However, they could not find anything but were able to collect data that could be useful for upcoming offshore ventures.

In addition to the 35 offshore sites, the government is poised to auction 10 onshore sites for hydrocarbon exploration, starting December 2019, said Power and Petroleum Minister Omar Ayub Khan in a meeting with German Ambassador Bernhard Schlagheck on Friday.

OGRA recommends slight reduction in petrol price

Special Assistant to the Prime Minister on Petroleum Nadeem Babar was also present in the meeting.

The minister emphasised that Pakistan’s energy sector was developing fast as it was offering around $60-billion market for renewable energy generation, transmission and distribution along with the petroleum sub-sector, which offered huge oil and gas exploration opportunities at around 40 new sites. Auction for these sites would be held next month.

He pointed out that for the first time provinces in Pakistan had been given a major and leading role in decision-making on new renewable energy projects as well as project implementation. A steering committee, with representation from all provinces, would be constituted for the purpose in the Alternative Energy Development Board (AEDB), he added.

He said the government had formulated a 25-year power generation plan alongside the transmission plan for commissioning new projects in the country.

Regarding exploration of new oil and gas reserves, the German ambassador was apprised that due to the absence of a clear globally acceptable policy, there was little exploration work as compared to the potential Pakistan had.

Now, after the policy has been revamped, the government is ready to auction around 35 offshore and 10 onshore sites for oil and gas exploration, starting December 2019.

The power minister briefed the envoy about the huge potential of increase in per capita electricity consumption in Pakistan, which currently stood around 500 kilowatts (kw) lower than the 2,500kw per capita consumption in China.

“This means electricity consumption will further increase in Pakistan with the adoption of business-friendly policies by the government,” he remarked.

Rift between OGDC high-up, board deepens

The minister reiterated that Pakistan government had formulated a circular debt capping plan and the increase in debt, which was growing by Rs39 billion per month during the tenure of previous government, was brought down to little more than Rs10 billion per month. “This will be arrested by the end of next year.”

He threw light on the steps taken by the government for bringing efficiency in the power sector. Owing to an extensive anti-theft campaign, recovery drives, action against employees of power companies and such other measures, 80% of feeders across the country are now receiving uninterrupted power supply. Work on the remaining 20% feeders is also going on at a fast pace and is on track.

Apart from these, power distribution companies are making considerable investment in new technology including AMI meters and Areal Bundled Cables to enhance their efficiency and slash losses.

Speaking on the occasion, Nadeem Babar revealed that a multi-year auction of bulk renewable energy projects on a competitive bidding basis was under consideration.

“It will also be beneficial for the manufacturing of renewable energy equipment such as solar panels and wind turbines in the country, providing investors with a good market size and terms for their businesses besides creating considerable job opportunities,” he added.

The German ambassador was of the view that the entire developed world and their entrepreneurs were watching developments in Pakistan and were ready to make investment.

“German companies are also interested in taking part in the upcoming bidding for renewable energy projects,” he said.

Published in The Express Tribune, November 30th, 2019.

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

Facebook Conversations

Leave Your Reply Below

Your comments may appear in The Express Tribune paper. For this reason we encourage you to provide your city. The Express Tribune does not bear any responsibility for user comments.

Comments are moderated and generally will be posted if they are on-topic and not abusive. For more information, please see our Comments FAQ.

More in Business