Professional Documents
Culture Documents
Dr Gulfaraz Ahmed
Former CEO OGDCL, Federal Secretary Petroleum
18 June 2014 at Grand Hyatt Hotel Shanghai
Pakistan Primary Energy Supply Mix (%)
64.8 Million TOE (2012-2013)
6 % 0.5 %
12.8 %
Co
Hydro al
& Nuc
N Gas 48.2 %
Oil
32.5 %
Natural gas based energy economy: 1st Iran, 2nd Russia, 3rd Pakistan
Country wide gas transmission, distribution and utilization network
83 % of oil consumed is imported that equals 27% of total energy mix
Coal input is 1/4th of world average: environmentally cleaner energy mix 05/14
Natural Gas Consumption by Sector (%)
1.506 tcf in 2012-2013
05/14
Electricity Generation by Fuel
96122 GWh (2012-2013)
4% 0.1 %
35.9 %
28.2 % Generation
Cost/KWh
N Gas Oil N Gas: Rs 4.5-5.5
Industrial Fuel Oil: Rs 17-18
tariff highest Diesel: Rs 22
in the world Nuclear: Rs 7-8
Coal: Rs 9-10
31.1 % Hydro
The world dreads generating electricity with oil: India & USA
generate less than 1%. No country’s economy can sustain generating
35.9% electricity using oil for years on end. 05/14
Urgent need to replace oil by natural gas, nuclear and coal in power
Fuel Consumption for Thermal Power
Generation 2012-2013
Diesel Oil: 218584 tons oil equivalent
Furnace Oil (FO): 7342755 tons oil equivalent
Natural Gas: 7084177 tons oil equivalent
25.055
tcf
Remaining Produced
32.021
tcf
4000
Indigenous Production
3000
2000
1000
8
y = 0.0142x2 - 56.779x + 56758
7 R² = 1
Billion Cubic Feet per Day
6.47
6
(46 mpta)
5
4 3.4 BCFD
3.88 (30 mpta)
3
2 2 (15 mpta)
1
0
2010 2012 2014 2016 2018 2020
Year
IP Gas Pipeline not likely to start delivering 1 BCFD gas to Pakistan in November 2015
TAPI Gas pipeline projected to deliver 2 BCFD by November 2018
Natural Gas Import Plan
Pakistan is facing natural gas shortage of 50 % exceeding 2
BCFD in constrained demand and 4 BCFD in unconstrained demand
scenario. While pursuing gas import through regional pipelines
from Iran and Turkmenistan, decision reliance has been placed on
import of LNG in short to medium time-frame.
Three LNG receiving infrastructure projects at Port Qasim,
Karachi have been approved by Cabinet Committee (ECC) in
principle. These projects will provide LNG receiving, storage,
regasification and transfer facilities.
(i) Fast Track Terminal Project – 400 to 500 MMCFD
(ii)SSGC LPG Retrofit Project – 500 MMCFD
(iii)New LNG Terminal Project(s) – 500 to 1,000 MMCFD
Half of the new importers since 2005 have selected FSRUs over the
land based terminals for:
• lower investment cost,
• Shorter time of completion
• Interim LNG import solution till completion of permanent
terminals
• Flexibility of deployment/redeployment
•
LNG Import Infrastructure
• Fast-track 400 million cubic foot gas (3mtpa LNG) for import
between November 01, 2014 and March 31, 2015 November
2105
• One FSRU based terminal is being developed in private
sector at Port Qasim, Karachi by M/s Engro - Elengy Private
Limited (EEPTL) after competitive bidding process at a
levelized tolling tariff of $0.66/MMBTU. An LNG Service
Agreement (LSA) was executed between EETPL and SSGCL on
April 30, 2014. The FSRU has been leased by EEPTL from
Exilrate.
• Additional Terminals are being planned but work will also be
started on a land-based terminal in parallel to increase LNG
import capacity to 15 mpta by end of 2017 and to phase out
leased FSRUs in the long run
Fast Track Terminal Project
M/s Inter State Gas System (ISGSL) called bids for obtaining the
LNG services of receiving, storage, re-gasification and delivery of
regasified LNG to Southern Gas Company Limited (SSGCL)
receiving point in the vicinity of Port Qasim, Karachi.
Consumer Prices include about 20% taxes inclusive of GST 17.5% and
Gas Development Surcharge 2.5%
Power/Industry/Fertilizer Fuel: US $ 6/million BTU Commercial: US $
7.7/million BTU
CNG: US $ 8/million BTU
Fertilizer Feedstock: US $ 1.2/million BTU
Domestic:
Lowest Slab: US $ 1.2/million BTU
Highest slab: US $ 6.4?million BTU
Weighted Average(WA) Price ~ US $ 5/million BTU
Weighted Average(WA) less 20% Taxes ~ US $ 4/million BTU
14
Economics of Replacement of Diesel and Fuel Oil
in Power Generation by Imported LNG
1.0 mpta in BTU content = 1.104642 million tons HSD per year in
power generation
1.0 mpta in BTU content = 1.192733 million tons FO per year in power
generation
HSD used in power generation per year = 0.218584 million tons
FO used in power generation per year = 7.342755 million tons
LNG required to replace whole of diesel in power = 0.2 mpta
First 3 mpta will replace diesel and 3.33 million tons of Fuel Oil in
power generation
Average cost of diesel per ton:
Average cost of FO per ton (Jul13-Feb14): US$ 665
Cost of 3.33 million tons = US $ 2,214 billion
Breakeven Equivalent cost of 2.8 mpta = 2214 million
Breakeven Equivalent Cost of 1.0 mpta = 790 million
However, Pakistan is seeking to reduce the generation cost by
replacing FO by LNG, which has to be cheaper than breakeven price15
LNG Import Economics for Break-even Fuel
Replacement
Equivalent cost at power plant site ~ US $ 15.5/million BTU
FSRU fee/transportation to plant ~ US $ 1/ million BTU
Break-even Price of LNG Ex Ship ~ US $ 14.5/million BTU
90 $ 7.6 2017
60 $ 6.4 2016
30 $ 5.2 2015
LNG import increasing @ 3mpta per year
0 $ 4.0 2014
0 3 6 9 12 15
LNG Import mpta
Expectations of Government of Pakistan in LNG
Import
18
Installed Capacity MW
30000
For 2014, 2800 MW Installed Capacity with
28000 65% Plant Availability and 75% Plant Factor, it
will generate !20,000 GWh that would meet 26000
26000
the Demand and there would be no load
24000 shedding. 5000 MW short
22477
22000 22797
20922
20000 19257 19450 19420 19786
17399 17498 19384 19420
18000 17798
17799
15658 For 2011, with 65% plant availability and
16000
15662 75% plant factor 26000 MW generates
14000 110,000 GWh that would meet the
demand and no load shedding for 5 %
12000 GDP growth. 3000 MW short
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
04/2014
Gross Generation GWh
120000
For 2011, 22797 MW with 65% Plant Availability
and 75% Plant Factor generate about 95091 Gwh. 110000
110000 110000
Leaving a short fall of 14000 GWh. For no load
14000
shedding 26000 MW will generate 110000 GWh
100000 26000MW. Short fall 3000MW
98213 95358
95661
95091
94385
90000
91616
85629
83269
80000 80627
For 2014, 28000 MW with
75782
72405 similar availability/factor will
70000 generate 120000 GWh for no
65402 68117
load shedding for GDP Growth
62102 65751
60000 of 5%
1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
04/14
Fiscal year starting on July 01
Opportunities for Investment/Cooperation