Pakistan’s Energy Sector and The Great Game

Courtesy of Radio Australia, an interesting interview on Pakistan’s energy sector in light of the geopolitical “game” currently unfolding in Central Asia.  As the article reports:

QADRI: Pakistan is not just a gateway to mineral resource wealth in Central Asia and the Middle East, it is itself rich in minerals and fossil fuels. According to government sources, there are believed to be reserves of 27bn barrels of oil and 280trn cubic feet of gas. Yet most of that wealth remains locked away: only 3.4 per cent of oil and 19 per cent of gas resources have been tapped thus far. Petroleum geoscientist Jim Harris explains.

HARRIS: In terms of oil and gas resources it’s got significant remaining exploration potential. But that potential is hidden in a complex geology, largely caused by the way in which the countries involved in the Indian-Himalayan plate collision… India-Eurasia collided about 40 million years ago and they’ve continued to rub into each other creating a really complicated geological scenario which demands a lot of work to unravel and to find hydrocarbons in that environment is difficult.

QADRI: The most promising sites lie in the unstable regions of Balochistan and the North West Frontier Province where authorities have been battling the Taliban and separatist groups. But that turmoil hasn’t stopped companies from looking to invest in Pakistan.

HARRIS: The really big remaining exploration potential is in the frontier provinces, offshore in the Makraan, and also in the Balochistan and the margins of the country… They are the most underexplored so they present a very high risk area of the country but with high risk you get high reward.

QADRI: This is Pakistan national adviser for petroleum and natural resources, Asim Hussain.

HUSSAIN: I think there has been a lot of interest and the world’s major players are there. BP, for instance is there, British Petroleum, ENI from Italy is there and there are some more, from Hungary, is there. So there are major players. OMV is there from Austria. So the world’s major players are there.

QADRI: In fact, eighteen out of twenty companies operating ventures in Pakistan are foreign-owned. Geologist Jim Harris again.

HARRIS: Whether or not you believe in Peak Oil, Pakistan will present attractive exploration opportunities, as you can see here with 125 delegates at this meeting. That means there’s interest.

QADRI: But multinationals are not the only ones interested in Pakistan’s energy sector. With its ever-growing population, Pakistan has struggled to match energy supplies with demand. Those difficulties turned violent in August when angry mobs in Karachi and the Punjab protested against the long daily power cuts that have brought modern life to a standstill here. I asked Asim Hussain what the Pakistan government was doing about this problem.

HUSSAIN: See we have inherited these problems and as I said there was no planning done. There was no petroleum policy for the last three or four years and everything takes time. So if the planners had planned for ahead things would not have been in this situation. So there is no quick fix to the present situation but will it take some time and everything will be online. This government is doing a lot about it and since 1994 there has been very few power projects which should have been a priority from the beginning.

QADRI: Authorities say they hope to raise national power generation up to 4000 megawatts by 2010 But there are concerns the target is unlikely to be met as the battle against the Taliban rages on and the economy remains stagnant. Mustafa Qadri, Connect Asia.



This entry was posted on Sunday, November 15th, 2009 at 6:19 am and is filed under Pakistan.  You can follow any responses to this entry through the RSS 2.0 feed.  You can leave a response, or trackback from your own site. 

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Wildcats & Black Sheep is a personal interest blog dedicated to the identification and evaluation of maverick investment opportunities arising in frontier - and, what some may consider to be, “rogue” or “black sheep” - markets around the world.

Focusing primarily on The New Seven Sisters - the largely state owned petroleum companies from the emerging world that have become key players in the oil & gas industry as identified by Carola Hoyos, Chief Energy Correspondent for The Financial Times - but spanning other nascent opportunities around the globe that may hold potential in the years ahead, Wildcats & Black Sheep is a place for the adventurous to contemplate & evaluate the emerging markets of tomorrow.