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June 14, 2019

WB to conduct study for underground gas storages


June 14, 2019

ISLAMABAD: In a new development, the government has assigned the Word Bank to conduct a study for construction of strategic underground gas storages across the country, a Petroleum Division senior official told The News.

The official said RLNG was mainly imported on the demand of Power Division and other sectors of economy.

The Power Division has the biggest demand of 900 mmcfd. At times, the power demand fluctuates because of temperature fluctuations, but it adversary impacts the RLNG supply and committed orders of RNG.

When the power demand goes down, the RLNG usage in the power plants tumbles, but in the wake of committed RLNG import, the Sui Northern has to face demurrages for keeping the RLNG ships in sea for more time.

More importantly, when the RNLG is not used in the power plants in Punjab, sometime the gas pressure increases, damaging the pipeline.

“Right now, we have the RLNG storage in the pipeline. When the electricity demand decreases because of low temperature in Punjab and Northern Areas, the usage of the RLNG in power houses also tumbles and under this scenario if Pakistan has gas storages, then committed RLNG can be injected in the storages.

“We have asked the World Bank to initiate a study on gas storages for developing strategic underground gas storages across the country to ensure energy security. Pakistan currently possesses no capacity to store even a single gas molecule,” said the official.

The USA has the gas storages capacity for 10 years. “China and Japan have also built many gas storages, and more importantly India has also built gas storages, but Pakistan stands nowhere.

‘’Once the study gets completed, then the Petroleum Division will seek guidelines on whether it should go for a government-to-government (g-to-g) arrangement or tendering mechanism (international competitive bidding) for developing the underground gas storages.’’

Spokesman for the Petroleum Division Sher Afgan confirmed the development saying that building gas storages was the mandate of Inter-State Gas System and it was vigorously working on the task.

“If we go for one week gas storage capacity, then the government will have to store 3 billion cubic feet gas per day. In case, we initiate the underground storage capacity for 15 days, then the government will build storages for 6 billion cubic feet gas per day.”

Mr. Saulat also disclosed that Inter-State Gas system had already sought investment for building the said storages from Saudi Arabia during a recent interaction with the Saudi officials. Russian company Gazprom is also interested in developing the underground gas storages, but the ISGS needs guidelines from the ECC on the mechanisms ----- g-to-g arrangements or international competitive bidding ----- for building the underground gas storages.

He said the government had a feasibility study for developing gas storages but that was an old one and now the government wanted to get it updated.

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