Oil and gas consumption in key sectors

Deriving most of its energy requirements from oil and gas, Pakistan’s dependence on these hydrocarbons has been growing where the depleting indigenous resources are being offset by imports.

According to the Economic Survey 2016-17, the domestic production of crude oil stood at 24.2 million barrels during 9MFY17 versus 24.0 million barrels (around 3.4 million tonnes) during the corresponding period of FY16. Along with production, the country imports large quantities of oil and petroleum products from Saudi Arabia and other Middle Eastern countries. These crude oil imports stood at 5.9 million tonnes in 9MFY17 versus 4.2 million tonnes in 9MFY16.

In terms of consumption by sector, transportation and power are the two major users of oil, and the share of oil consumption has increased in these two sectors. For 9MFY17, transport sector accounted for 57 percent of consumption (versus 55 percent in 9MFY16), particularly in the form of refined petroleum products like petrol and diesel. Share of power sector in total oil consumption on the other hand has seen some decline post FY15, as the government initiated various coal- and LNG-based projects to lower furnace oil consumption. Oil consumption in the power sector for 9MFY17 also stood lower at 33 percent versus 34 percent in 9MFY16.

Indigenous gas still stands at around 4.0 billion cubic feet per day. The imports have come in the form of liquefied natural gas (LNG), which according to the Economic Survey 2016-17 increased to 129,092,714 mmbtu in 9MFY17 versus 62,373,272 mmbtu in 9MFY16. The survey highlights that the average natural gas consumption was near 3,654 million cubic feet per day (mmcfd) including 410 mmcfd volume of RLNG during the first eight months of FY17.

The illustration shows that the power sector has been the key consumer of gas followed by the industry, which has seen a decline in the last couple of years as gas curtailment policy continued amid limited supply. The share of transport sector (in the form of CNG) has also tapered off over the years after peaking in FY12, as the government has continued with its policy to restrict the heavy CNG usage.