Approval granted for sale of new gas reserves after 11-months delay

ISLAMABAD: A light level committee of the government approved the sale of nearly one-third of the newly discovered gas reserves, Dawn news reported.

The committee, chaired by Deputy Prime Minister Ishaq Dar, granted the approval after 11 months of resistance by the government-owned gas companies. The said committee was formed by Prime Minister Shehbaz Sharif “to develop a comprehensive action plan for addressing the challenges faced by the Exploration and Production (E&P) sector in Pakistan,” the news report added.

The committee allowed for the sale of 35 per cent of the newly discovered reserves to private entities, through a bidding process.

The sale is aimed to improve the liquidity position of exploration and production (E&P) companies. With the sales approval, it is also expected that $4 billion to $5 billion investment will be poured in the E&P sector.

The final bidding and sale process will commence after the formal approval by the Executive Committee of the National Economic Council (ECNEC). The proposal submitted to ECNEC adds a 100 million standard cubic feet per day cap on sales for the first year, with the room open for review afterwards. The proposal will be submitted to ECNEC in its next meeting scheduled for today (Tuesday).

The original idea to sell gas reserves to third-party private companies was first presented by the Council of Common Interests (CCI) in January this year. The CCI had asked the E&P companies to seek ECNEC’s approval on a selling framework for 35 per cent of the reserves. However, the Sui Northern Gas Pipelines Limited (SNGPL) and the Sui Southern Gas Company Limited (SSGC) had been resisting this decision.

As per Dar’s committee, the bidding round for available onshore exploration blocks will be initiated by December, with a bid submission deadline of March 15, 2025.

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