ENERGY POLICY DIALOGUEUSPCAS-E UET PESHAWAR

OIL & GAS

KHYBER PAKHTUNKHWA OIL & GAS COMPANY LIMITED

(KPOGCL)Raziuddin, CEO KPOGCL

4-Oct-2015

2

THEME…

Evolve Energy Policy via Dialogue wrt KP

1. Profound Impact on Socio-Economic development

2. Solutions for Energy Crisis

Pakistan Energy SecurityKhyber Pakhtunkhwa Socio-EconomicCross-road of civilizations25 Million PeopleGreat potential

Natural Resources Human Resources

3

KHYBER PAKHTUNKHWA OIL/GAS POTENTIAL

The new Geological Frontier Producing more than 50% of indigenous

crude oil Producing more than 15% of indigenous

natural gas Producing more than 25% of indigenous

LPG Out of 33 Exploration & Production

Companies, 13 are working in Khyber Pakhtunkhwa.

10 TCF and 600 Million Barrels of Oil

4

POLICY FRAMEWORK ENTAILS

1. Constitution2. Amendments (18th Amendment)3. Sub-Legislations/Acts4. Policies5. Rules of Business6. Fourth Schedule7. Council of Common Interest CCI8. Plans (Vision-2025, 11th Five Year Plan)9. Regulators10. Policy Makers

5

CRUDE OIL PRODUCTION & USE(PAKISTAN ENERGY YEAR BOOK 2014)

KP50%Sind

h35%

Pun-jab

15%

Balochistan0%

KP5%

Sindh23%Pun-

jab63%

Balochistan9%

6

NATURAL GAS PRODUCTION(PAKISTAN ENERGY YEAR BOOK 2014)

Punjab5%

Sindh

68%

KP11%

Balochistan17%

Pun-jab

42%Sind

h46%

KP6%

Balochis-tan5%

7

KP PRODUCTION FORECASTING OF OIL

2009

-10

2010

-11

2011

-12

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

2033

2034

10,000

30,000

50,000

70,000

90,000

110,000

130,000

150,000

170,000

14,5

35

21,4

00

25,8

91

35,9

74

45,1

61

47,0

36

56,4

89

67,3

90

88,3

10

118,1

71

135,6

01

146,9

43

149,5

81

157,8

21

159,2

64

166,0

75

166,3

09

167,0

80

163,3

58

158,9

38

154,9

93

146,4

37

132,8

12

110,2

91

56,3

24

PRODUCTION FORECAST OF OIL IN KHYBER PAKHTUNKHWA UP TO 2034

BO

PD

8

KP PRODUCTION FORECASTING OF GAS

2010

-11

2011

-12

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

2033

2034

-

200

400

600

800

1,000

1,200

1,400

1,600

345

371

365

362

366

447

605

780

966

1,1

59

1,2

30

1,2

96

1,3

40

1,3

83

1,4

16

1,4

26

1,4

27

1,4

03

1,3

69

1,3

31

1,2

64

1,1

10

885

610

PRODUCTION FORECAST OF GAS IN KHYBER PAKHTUNKHWA UP TO 2034

MM

CFD

9

KP PRODUCTION FORECASTING LPG

2009

-10

2010

-11

2011

-12

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

2027

2028

2029

2030

2031

2032

2033

2034

-

500

1,000

1,500

2,000

2,500

71

119

215

255

320

339

459

852 1,3

84

1,7

05

2,0

83

2,1

59

2,1

98

2,2

12

2,2

35

2,2

00

2,2

00

2,1

86

2,1

65

2,1

17

2,0

74

1,9

33

1,5

78

1,0

25

740

PRODUCTION FORECAST OF LPG IN KHYBER PAKHTUNKHWA UP TO 2034

TP

D

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CONSTITUTIONArticle 158

‘’ The Province in which a wellhead of natural gas is situated shall have precedence over other parts of Pakistan in meeting the requirements from the well-head.’’

Article: 172 (iii)‘’Subject to the existing commitments

and obligations, mineral oil and natural gas within the Province or the territorial waters adjacent thereto shall vest jointly and equally in that Province and the Federal Government’’

11

CONSTITUTIONArticle: 161

1. Notwithstanding the provisions of Article 78;a. the net proceeds of the Federal duty of

excise on natural gas levied at well-head and collected by the Federal Government, and of the royalty collected by the Federal Government, shall not form part of the Federal Consolidated Fund and shall be paid to the Province in which the well-head of natural gas is situated.’’

b. the net proceeds of the Federal duty of excise on Oil levied at well-head and collected by the Federal Government, shall not form part of the Federal Consolidated Fund and shall be paid to the Province in which the well-head of oil is situated.

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POLICIES

Petroleum Policy 2012 (Federal) Petroleum Rules 2013 (Federal) Shale Gas Policy Draft Tight Gas Policy 2013 (Federal) LPG Policy 2015 Draft (Federal)

Dynamics keep changing New policy every 3 to 4 years International Research needed to develop an

attractive policy

13

POLICY MAKING FOR KPObjectives Get rid of Load Shedding misery (Electricity &

Gas) Attract Industries by giving un-interruptible

and cheap power and gas supplies

Ways and Means for KP to Achieve Objectives1. Inundate the market with fuels (Supply-side

Economics)2. Deregulate the market3. Provincial Government to take lead in oil and

gas Exploration & Production, refining, gas infrastructure and LPG plants

4. Capacity Building

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TARGETS FOR KP 2025

1. Per capita Consumption target 4000 koe (National 3500 koe)

2. 900 mmcfd gas to industries3. Connect 80% of Population with gas4. Fertilizer Plant 750,000 TPA5. Refinery 100,000 bpd6. Thermal Power Plants 2 x 800 MW

(GE 9FB)7. FDI of US$ 10 Billion8. National investment of US$ 3 Billion9. Peshawar Stock Exchange

15

DEVELOP FOR KP

KP Vision-2025KP 5 year PlansEstablishment of KP-OGRAAcademia, industries, businesses to join in development alongside the Government of Khyber Pakhtunkhwa

Policies for Up-mid-down streamsInternational Showcasing

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KP OIL/GAS POLICIES 2016 NEEDED

1. Research for competing Policies in the region2. Interact with stakeholders3. KP Petroleum Policy 2016 (Article 172-3)

1. Conventional2. Tight Gas3. Shale Gas

4. KP Petroleum Rules 20165. KP LPG Policy 2016 (Article 158)

1. Production incentives2. Use efficiency

6. KP Gas Policy 2016 (Article 158)1. Production incentives2. Use efficiency

7. Market the Policies

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KHYBER PAKHTUNKHWA OIL & GAS COMPANY LIMITED (KPOGCL)

ThanksQ&A

Razi Uddin (Razi)

CEO

KP Oil & Gas Company Ltd. (KPOGCL)www.kpogcl.com.pk

Cell +92 300 500 1038, +92 333 538 0240 Phone: +92 91 5615142-48 Fax: +92 91 5615149

Email: razi.ceo@kpogcl.com.pk Peshawar, Khyber Pakhtunkhwa PAKISTAN

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CONTINUE…

Article: 157 ‘’Provided that the Federal Government shall, prior to taking a

decision to construct or cause to be constructed, hydro-electric power stations in any Province, shall consult the Provincial Government concerned’’

‘’In case of any dispute between the Federal Government and a Provincial Government in respect of any matter under this Article, any of the said Governments may move the Council of Common Interests for resolution of the dispute’’