Pakistan, with remaining proven recoverable oil reserves of over 370 million barrels (MMbbl), has great potential for the production of liquid hydrocarbons, which has remained unexplored optimally, since total technically recoverable resources have not been estimated as yet. Also, recoverable shale oil resources are extremely rich, besides prognostic offshore oil resources. The significant new onshore discoveries of oil and gas recently made across the country are manifestation to the existence of high potential of oil reserves. Just a fortnight ago, oil has been discovered in Nashpa Well X-5 in District Karak, Khyber Pakhtunkhwa (KP) at a depth of 5,056 metres, having successfully produced 1,032 barrels per day (bpd) crude oil.
Discovery of oil in today’s Pakistan dates back to more than a century. Exploratory drilling at the site of Khaur oilfield (Tehsil Pindi Gheb, District Attock) in Potohar region was started in January 1915, where 5,000 barrels of crude oil flowed at an extremely shallow depth of 68 metres. This, subsequently, resulted in two small stills (distillation columns) of 2,500 bpd oil coming on stream. In all, 396 shallow wells were drilled in Khaur oilfield up to 1954. Meanwhile, the second discovery was made in Dhulian oilfield in the same area in 1937, where the first commercial oil production was obtained. A total of 49 wells were drilled in Dhulian oilfield till 1966.
Further investigations and explorations in the area indicated high potential for crude oil production, and thus other discoveries were made in succeeding years in Joya Mair, Balkassar, Karsal, Toot, Meyal and Sarang oilfields. Since then onshore oil exploration and production activities picked up on a large scale, having attracted foreign investment in subsequent years. Adhi oilfield discovered in 1978, with original reserves of 10.221 MMbbl of condensate, has been producing 2,449 bpd. Discovered in 1984, Dhurnal is the largest oilfield discovered in the country so far, with original reservoir of 50.94 MMbbl of oil. Likewise, Fimkaser of original reserves of 30 MMbbl was discovered in the same year. Discovered in 1991, Missakaswal, with original reserves of 34.74 MMbbl, has produced average 4,930 bpd.
Currently, there are 24 international and domestic companies and joint ventures operating in Pakistan. These are Attock Oil Company, Dewan Petroleum, Eni Pakistan, Government Holdings, IPR Transoil Corporation, KP Oil & Gas Company, KUFPEC Pakistan, Mari Petroleum Company, MOL Pakistan, Oil & Gas Development Company (OGDCL), OMV (Pakistan), Ocean Pakistan, Occidental Petroleum (Pakistan), Orient Petroleum, Petroleum Exploration, Premier Oil Pakistan, Polish Oil & Gas Company, Pakistan Oilfields, Pakistan Petroleum (PPL), Saif Energy, Sindh Energy Holdings, Tullow Pakistan, United Energy Pakistan and Zaver Petroleum Corporation.
The current oil producing fields, besides some producing substantial quantities of natural gas and LPG as well, are Adhi Oilfield, Pirwali, Minwal, Turkwal, Pindori, Kithar, Ikhlas, Chak Naurang (District Chakwal), Gulgalot, Kotra, Dhurnal and Ratani (District Attock) and Bhangali (Gujar Khan) in the Potohar, Tal Block in District Kohat (Manzalai, Makori, Mamikhel, Marmazai), Karak Block in KP, Gorakh, Mithi, Rajar, Umarkot, Thar, Mubarak, Gambat, Latif blocks and Sanghar in Sindh, and others. Latest discovery in Tal Block, in March 2015, is at Mardan Khel of 4,383 bpd condensate. Currently, the Badin Block, with 17 oilfields, has major share in total indigenous oil production. These include Bari with original reserves of 2.531 MMbbl, Pasakhi with 9.37 MMbbl, Tando Alam with 20.16 MMbbl and Khashkeli with 8.196 MMbbl.
The Badin crude, though of high quality and low in sulphur, has limitations for refining as it contains high percentage of wax and has to be mixed with imported crude oil. This has resulted in surplus Badin crude, to the level of 9,000-10,000 bpd, which was exported until 2005. Export of crude oil has emerged again since June 2014 as the government has allowed petroleum producers to ship surplus quantities to foreign buyers in the wake of availability of large quantities of ultra-light crude oil (condensate, coming out of gas-fields) that is difficult to process in most of local refineries. Resultantly, crude oil has now a significant share in Pakistan’s exports of the petroleum group amounting to $ 586 million in 2014-15.
In terms of oil production, Pakistan is globally ranking 42nd among 98 oil-producing countries. From 10,000 bpd in 1980s, crude oil production increased to 60,000 bpd in 1990s, but remained static until the 2,000s. It was only in 2013 that oil production jumped to 80,800 bpd, having achieved all-time high 98,000 bpd in November 2014. Interestingly, crude oil production registered 91,000 bpd in May 2015 and 93,000 bpd in June 2015. While its share in total consumption of oil was about 10% until 1980s, at present indigenous oil meets about 23% of total national demand of the oil refineries in the country. An integrated network of pipeline exists for transportation of indigenous crude oil to the refineries.
Indeed, the availability of indigenous crude oil expands the opportunity to meet growing demand of oil and to reduce Pakistan's dependence on imports, but it is imperative for the government to accord high priority to developing the sector expeditiously. It may be advisable for the government to revisit the Petroleum Exploration & Production Policy 2012 in vogue, since discoveries are correlated with drilling efforts.
The writer is ex-chairman of the State Engineering Corporation
