Engro Powergen Qadirpur seeks 40mmscfd gas from Kandhkot field

ISLAMABAD: M/s Engro Powergen Qadirpur Limited (EPQL) has sought the allocation of up to 40 million cubic feet per day (mmscfd) of gas from the Kandhkot gas field on as-and-when available basis, sources told Business Recorder.

In a letter to Private Power and Infrastructure Board (PPIB) Managing Director Shah Jahan Mirza, EPQL Chief Executive Officer Adeel Qamar referred to earlier correspondence on the issue and recent media reports regarding deliberations to reallocate a portion of Kandhkot gas due to its lower utilisation at the Guddu Power Plant.

He stated that persistent underutilisation of indigenous gas at Kandhkot, coupled with the progressive depletion of the Qadirpur gas field, has materially constrained EPQL’s generation potential despite the plant’s high operational readiness.

The company noted that over the past several years, Pakistan Petroleum Limited (PPL), the operator of the Kandhkot gas field, has consistently reported lower offtake of Kandhkot gas by GENCO-II (Guddu Power Plant), owing to a combination of technical de-rating and planned maintenance cycles.

Information available in the public domain, it added, confirms that a sustained volume of Kandhkot gas has remained unutilised over an extended period.

At the same time, EPQL has been operating at lower load factors as Qadirpur gas volumes have been declining steadily since 2018. Current daily flows average around 27 mmscfd, compared to a design requirement of 63 mmscfd.

READ MORE: Kandhkot to third-party buyers: PPL seeks PD’s approval to redirect unutilised gas

According to EPQL, these circumstances present a unique opportunity whereby indigenous gas already allocated to the power sector, but currently under-utilised, can be redirected to an existing independent power producer (IPP) without altering sectoral allocations, imposing new obligations on the gas system, or requiring additional generation capacity.

EPQL is designed to operate on 63 mmscfd of gas at full load and can utilise up to 30 mmscfd of Kandhkot gas on an as-and-when-available basis. This would raise the plant’s load factor to 85–90 percent from the current 45 percent, enabling recovery of significant indigenous generation lost due to the depletion of the Qadirpur reservoir.

To ensure complete due diligence, the company stated that it has already undertaken: (i) an OEM (GE) assessment confirming turbine compatibility with a co-mingled Kandhkot and permeate gas stream; (ii) a basic survey and engineering design for pipeline connectivity options between Kandhkot and EPQL, including utilisation of existing gas field networks; (iii) validation of gas specifications confirming alignment in calorific value, composition, and pressure; and (iv) execution readiness, with an estimated completion timeline of six to nine months, given the short, near-field integration.

According to the CEO, these factors make EPQL the most technically suitable and geographically efficient asset for the timely and safe utilisation of surplus Kandhkot gas.

He further argued that reallocating surplus Kandhkot gas to EPQL on an as-and-when-available basis represents a win-win proposition for all stakeholders. Over the next 10 years, the proposal is expected to generate savings of Rs47–68 billion for the power sector compared to imported coal or RLNG, leading to a direct reduction in consumer electricity tariffs. In addition, higher load-factor operations at EPQL would enhance grid stability in the region.

The gas supplier, the company added, would earn revenues of Rs96.6 billion over the remaining power purchase agreement (PPA) term, while the country would realise foreign exchange savings of USD484–604 million through reduced reliance on imported fuels.

EPQL also referred to the agreement signed between the government of Pakistan, EPQL, and CPPA-G on February 17, 2025, under which the government assured facilitation of additional gas allocation to EPQL to provide cheaper electricity to the national grid.

Following this background, EPQL has sought government approval through PPIB for the allocation of surplus Kandhkot gas in the range of 30–40 MMSCFD on an as-and-when-available basis.

“This is a technically viable, financially feasible, and win-win solution that converts already-produced indigenous gas into immediately dispatchable and affordable electricity, while supporting the gas supplier and, most importantly, reducing the cost of electricity for consumers,” the company stated.

Copyright Business Recorder, 2026