ISLAMABAD: Pakistan is expecting discovery of oil and gas reserves in ultra-deep waters offshore Karachi as the drilling at Kekra-1 has almost reached its climax, an official said on Tuesday.

“There is an optimistic prospect of finding energy resources at Kekra-1,” the Special Assistant to the Prime Minister for Petroleum Nadeem Babar said. He was talking to a delegation, headed by Alex Volkov, chairman of Liquefied Natural Gas (LNG) Market Development at Exxon Mobil.

Led by US oil and gas company Exxon Mobil, a consortium consisting of Italian ENI, Oil and Gas Development Company and Pakistan Petroleum Limited is currently conducting offshore drilling at the block. The joint venture of Indus-G block spud an exploratory well – namely Kekra-1 – in ultra-deep water on 13 January, 2019. The well will be drilled up to the total depth of 5,660 meters in ultra deep waters, which is currently at 4,810 meters.

“Drilling has been entered in the phase where it will be easy to estimate that there is any oil or gas,” an official statement said.

Minister for Petroleum Omar Ayub Khan said the government would give all assistance to international investment. The government will defend free and safe investment in the country. The minister said employment would be generated after exploration.

Irtiza Syed, president of Exxon Mobil said the Exxon Mobil is interested in drilling of more offshore blocks and in LNG imports into the country. The company could also help in making of environmental friendly policy for off shore drilling.

The entry of Exxon Mobil in Pakistan is a positive signal for the exploration and production sector of the country. The petroleum division of ministry of energy has already drafted Pakistan Offshore (Exploration and Production) Rules 2019 and Model Production Sharing Agreement 2019, which will be submitted to the cabinet for approval. The government has already waived duties and taxes on import of drilling equipment to encourage indigenous exploration and production of energy resources as the country is confronted with widening gap in energy demand and supply.

The Oil and Gas Regulatory Authority (Ogra) said the gap between the supply and demand is expected to increase to the tune of 4,600 million metric cubic feet / day in FY2022/23 and 6,700 mmcfd by the FY2027/28. The country currently produces around 4,000 mmcfd of natural gas – accounting for 48 percent share in the primary energy mix – against demand of more than 6,000 mmcfd. The demand-supply gap of gas during FY2017/18 was 1,447 mmcfd. The gap is expected to rise to 3,720 mmcfd in the next fiscal year starting from July 2019.

“The possible gap would be bridged through enhancement in indigenous gas exploration and production through incentivising the sector, import of interstate natural gas – through development of cross-country gas pipelines – and increased import of liquefied natural gas,” the Ogra said in its latest state of petroleum industry report.

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