Background

An Asian Development Bank (ADB) Mission visited Pakistan during September 2003, for providing Technical Assistance (TA) for undertaking a feasibility study in selecting and developing underground gas storage system. The purpose of the study was to identify suitable underground reservoirs in Pakistan that could be used to store natural gas for: (i) meeting seasonal gas demand fluctuations; and (ii) Strategic Underground Gas Storage (SUGS), for emergency supply into the proposed gas import pipelines.

A Feasibility Study on the development of underground gas storages was undertaken by SOFREGAZ, France in 2004.. The Consultant has extensively studied a number of potential reservoir sites including depleted gas fields and prepared a short-list of potential storage reservoirs and estimating the capital & operating costs and time lines to ready these reservoirs as strategic gas storages.

The Consultant submitted the Final Report in November 2007 and recommended two potential sites of Khorewah and Bokhari in the Badin Block in Sindh Province for conversion into gas storages, and has also proposed various options for the project structure, financing and revenue generation from these gas storage projects.

Transportation of natural gas through high pressure pipelines can be interrupted for various reasons; causing huge losses of production in the downstream industry. Underground storage of gas provides the short term standby reserves to mitigate such risks of interruption in supplies until the main stream supplies are restoredor to meet fluctuations in demand such as winter peak slaving. UGS projects have been implemented as a viable alternative for the continuity of gas supply across the globe; especially USA, UK, Germany, Russia and Turkey have developed huge UGS facilities by deploying depleted gas fields, salt caverns and aquifers. Keeping in view the upcoming natural gas import projects including IPI and TAPI, ISGS is planning to develop and implement this project parallel with the commissioning of these pipeline projects to ensure the uninterrupted supply of natural gas.

Status Of Agreement

With the recent signing of TAPI, LNG deal with Qatar, there is renewed momentum by the Government towards exploring various opportunities under Under Ground Gas storage programme. The Government of Pakistan is actively pursuing UGS options and work towards that milestone is very much in progress.

UGS Graph

Other Projects