Gas shortages, here we go again

According to Pakistan’s Institute of Development Economics (PIDE), household users account for around half of overall gas usage.

As I am writing in November, I see gas shortages taking up the news again. The demand increases in the winter months while the supply doesn’t, and the household users become super annoyed.

So, are we short on gas?

Not quite! According to a World Bank report, Pakistan is one of the most gas-intensive countries in the world.

Let’s back up a bit and see why Pakistan is facing these gas shortages.

The discovery

The Pakistan Gas Industry began in 1952 with the discovery of a significant gas resource in Balochistan near Sui. Before the discovery of gas, the primary fuels utilized in the household sector were coal, kerosene, and wood (good ol’ times).

Pakistan Petroleum found natural gas near Khairpur in 1957. Gas deposits were discovered in Mari in the same year.

During the 1960s and 1970s, gas exploration declined as the focus turned to oil discovery across Pakistan.

OGDC dug and discovered significant volumes of gas in Kothar in 1973 and Hundi in 1977.

OGDC identified Pakistan’s third-biggest gas field in Qadirpur in 1990.

Gas output has been stagnant in recent years due to market distortions and bottlenecks in gas exploration during the 2000s. Production from new gas fields barely covers the decline of existing resources.

This brings us to the current situation.

The consumption issue

Despite the fact that 78% of Pakistani families do not have access to natural gas, domestic consumption has increased by roughly 11% over the years.

With no substantial gas discoveries in recent years, gas output has begun to fall after peaking in 2012.

As a result, distributing gas to residences needs large investments. This brings me to the second point.

The economic issues

We all know how much Pakistan is battered economically right now. In the last five years, Pakistan’s economy has been hampered by an endless cycle of debt, currency depreciation, inflation, interest rates, high energy prices, and more.

There’s always this uncle who says, why aren’t we importing gas from Iran? We are afraid of the Americans, curse them, and curse our government.

Well, he’s right!

What’s the way forward?

First, we need to explore more and rely less on LNG.

To maximize rewards from private sector engagement and ensure the natural gas sector’s long-term viability, major structural and operational difficulties must first be addressed.

Two international pipelines are now under construction that might deliver more gas; the TAPI pipeline, which connects Turkmenistan, Afghanistan, and Pakistan, and the Iran-Pakistan pipeline, which will help with demand.

Till then, we are gonna keep having gas shortages.

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