KARACHI: Amid dwindling local gas reserves and as Pakistan rations supplies to residential and commercial consumers, an oil exploration company announced on Monday it had discovered new oil and gas reserves in the southern province of Sindh that would help fill an "energy demand and supply gap."
The cash-strapped nation has been hit with widespread gas blackouts, or load-shedding, this year after several failed attempts to buy gas from the expensive spot market. Pakistan also tried to get a long-term deal at more reasonable prices, but that hasn’t materialized, according to Bloomberg and other media. Local media has also reported that oil supplies remain tenuous owing to difficulties in paying for imports.
Oil and energy make up the largest portion of Pakistan's imports bill.
In a statement dated December 19, Oil & Gas Development Company Limited (OGDCL), a leading Pakistani exploration and production firm, said it had discovered oil and gas reserves in Sanghar district of Sindh province.
“The Oil & Gas Development Company Limited (OGDCL) as the operator (100%) has discovered oil and gas from development-cum-exploratory well namely Chak-5 Dim South-3, which is located in District Sanghar, Sindh Province,” the statement said, adding that the well was spudded on June 26, 2022 and drilled down to 3,400 meters.
“The said discovery shows aggressive exploration strategy of OGDCL. It has opened a new avenue and will positively contribute to mitigating energy demand and supply gap from indigenous resources and will add to the hydrocarbon reserves base of OGDCL and the country.”
Gas shortages always intensify in Pakistan with the arrival of winter. Pakistan needs 4.1 billion cubic feet per day (bcfd) of gas, with winter demand peaking at around 4.5 bcfd against local production of 3.22 bcfd. The shortfall is bridged through LNG imports.
Pakistan began importing LNG seven years ago. However, the price of the commodity in the international spot or short-term market has risen from lows of $2 per million British thermal units (mmBtu) in 2020 to highs of $57 in August this year after demand in Europe surged, pushing Islamabad out of the market.
