Islamabad: National Petroleum Minister Musadik Malik on Wednesday stated that negotiations with the Saudi Development Fund concerning the Reko Diq copper-gold project in Balochistan are approaching their final stage.
According to Zameen.Com, Minister Malik elaborated on the continuing talks with the Saudi government, which cover a range of projects, including the significant Reko Diq initiative and various water-related projects. In addressing concerns about the Iran-Pakistan Gas Pipeline, he dismissed claims of Pakistan receiving a PKR 18 billion penalty notice from Iran due to project delays, confirming that no penalties are forthcoming for either party involved.
The briefing also touched on several crucial aspects of the nation’s energy and economic strategy:
– Teams are addressing issues of electricity pricing, operations of generation companies, circular debt, and capacity payments.
– A commercial report for a green refinery, due in December 2024, will focus 40-50% on petrochemical production, with the remainder dedicated to crude petroleum processing, potentially lowering premium costs.
– Measures to manage a winter gas supply deficit using system gas, with strategies in place to handle the situation effectively.
– Imported Regasified Liquefied Natural Gas (RLNG) availability has reached 1,000 million cubic feet per day (MMcfd), complemented by 1,350 MMcfd from local pipelines and 1,200 MMcfd from dedicated local sources.
– Initiatives are underway to stimulate investments in oil and gas exploration, ensuring timely compensations to exploration and production companies, with Sui Northern Gas Pipelines Limited clearing 95% of its dues.
– Collaboration with the Maritime Affairs Division aims to reduce taxes and port charges on imported RLNG, which are currently approximately USD 4 per cargo.
– Considerations for seasonal tariffs to manage winter gas shortages and address capacity payments in the power sector are being discussed.
– Efforts are focused on price rationalisation and the Weighted Average Cost of Gas (WACOG) to balance gas prices, combining local and imported sources to achieve a target price range of PKR 1,700-1,800 per metric million British thermal units (MMBtu).
– Subsidies for lower-income households are planned through gas price blending, maintaining a wellhead price of PKR 570 per MMBtu, pipeline gas at PKR 1,280 per MMBtu, and RLNG at PKR 3,600 per MMBtu.