Politics of energy!

ENERGY
An energy crisis is any great shortfall (or price rise) in the supply of energy resources to an economy. Pakistan is in the grip of a serious energy crisis that is affecting all sectors of the economy. A change of attitude and a change of life style is needed at the national level. At best there could be some short and long-term solutions to the crisis but they need immediate planning and execution with an enormous investment.

CAUSES
Market failure is possible when monopoly manipulation of markets occurs. The cause may be:
1. 2. 3. 4. 5. over-consumption, aging infrastructure, choke point disruption or bottlenecks at oil refineries port facilities that restrict fuel supply. Pipeline failures

Political events, for example, when governments change due to regime change, monarchy collapse, military occupation, and coup may disrupt oil and gas production and create shortages.

Sources
Hydroelectricity Nuclear energy Coal World Bank report regarding the sources of energy in various countries and Pakistan Natural Gas

Natural Gas
An environmentally friendly and efficient energy source, natural gas is the cleanest-burning conventional fuel, producing lower levels of greenhouse gas emissions than heavier hydrocarbon fuels such as coal and oil. Types Of Natural gases
CNG (Compressed Natural Gas) LPG (Liquefied Petroleum Gas) LNG (Liquefied Natural Gas)

CNG (Compressed Natural Gases)

Reduction of air pollution in big cities. It is a cheap alternative to oil. It creates new business opportunities. Reduced gasoline consumption in Pakistan, caused by the increasing use of compressed natural gas (CNG), is creating a surplus of refined gasoline. Over 60,000 new jobs have been created in the CNG industry.

LPG (Liquefied Petroleum Gas)

The annual consumption of LPG in Pakistan is 600,000 tones out of which 20% is met through imports. The local production of LPG is 1300MT per day, while the demand is up to 1600-200MT per day By the end of 2011, 500Mt of additional production is expected. Below are some of the efficient companies which produce LPG:
PARCO (Pak Arab Refinery Limited) ARL (Attock Refinery Limited)

LNG (liquefied Natural Gas)

It can transport natural gas over large distances in ships, trains or pipelines and the gas is then converted into CNG before its distribution.

Production of natural Gas in Pakistan

Consumption Parameters of Natural Gas in Pakistan

Consumption Of CNG

Currently in March 2011 it was estimated that there are 3,329 CNG stations in Pakistan.

*NGVs : Natural Gas Vehices

Consumption of LPG
Liquefied petroleum gas contributes around 0.6 percent of the countrys total primary energy supply mix. LPG supply has been increasing an so has its consumption over the past few years. In 2010, LPG marketing companies had imported around 406975 MT of LPG. Whereas now in 2011, these companies have imported 55825.4 MT OF LPG. It shows a 13.7% increase of LPG supply and consumption this year.

Consumption of LNG
Government of Pakistan has been encouraging the import of LNG in order to increase its consumption. Pakistan Mashal LNG Project (PMLP) was conceived to cater for the energy need of the country as planned for the 25 year National Energy Security Plan and it was estimated that it would be able to supply around 3.5million tones per annum of LNG.

The worlds some countries consumption rate

Rank
1 2 3 4 5 6 7 8

Country
United States Russia Iran Germany Japan Canada United Kingdom China

Natural gas - consumption (cubic meters)

646,599,999,488 439,599,988,736 140,000,002,048 96,259,997,696 94,669,996,032 94,620,000,256 87,450,001,408 87,080,001,536

9
10 11 12 13 14 15 16 17 18 19 20

Italy
Saudi Arabia Mexico United Arab Emirate Uzbekistan Ukraine India Netherlands Indonesia France Argentina Egypt

78,120,001,536
77,099,999,232 59,799,998,464 59,420,000,256 52,600,000,512 51,999,997,952 51,270,000,640 48,599,998,464 45,199,998,976 44,840,001,536 43,140,001,792 42,500,001,792

21
22 23

Pakistan
Thailand Turkey

37,499,998,208
37,310,001,152 35,070,001,152

Distribution of Natural Gas

There are three major types of pipelines along the transportation route:
1. The Gathering System 2.The Interstate Pipeline System 3.The Distribution System

Price and Taxes on Natural Gas

Price of CNG
In 2011 heavy increase, crossed 100rs per kg. In 2010, slight increase In 2009 its price was Rs 48 In 2008 its price was Rs 22

Tax on CNG

Price of simple natural gas Price of LPG

The tax on CNG is due to change in its price. It is having RS 1 to5 tax.
The price level of simple natural gas has rapidly increased. In 2011 the price of LPG drops by RS 12 after PDL suspension. In 2008 the price of LPG was 10.

Load Shedding of Natural Gas

Load Shedding of Natural Gas
This year in 2011, load shedding has crossed every line, it has increased to such a level that the residents of the country are now facing huge problems. The large cities of the Punjab are witnessing massive gas load shedding in the morning and also in the evening, the worst in 24 years.

Problems faced due to shortage of Sui gas

The residents are unable to cook their meals two times. Many industries are unable to operate properly, and they remain closed which causes unemployment for many of the daily wages work force. Due to industry closure, businesses have been affected (50,000 power loom business are already out of business).

Load shedding of CNG

This week, CNG load shedding has been reduced to 2-days a week. A senior officer to the Ministry Of Petroleum and Natural Resources said that this winter 2011, the country would face gas deficit close to 1 billion cubic feet per day. Due to a decrease in the supply of CNG, Government has decided to put a ban on converting more private vehicles to CNG. This ban would be implemented on imported cars, CNG kits and cylinders.

Solutions to Overcome the Shortage of Gas

Use of advanced technology
By using the horizontal drilling technology and hydraulic fracturing process, we will not only be able to find out the new reserves of gas but also make it possible to extract large amounts of gas from existing gas fields particularly at the place of sui.

New contracts with foreign companies

New contracts may be awarded to foreign exploration companies for undertaking extensive soil survey with advance technologies to discover new reserves of gas.

 Importing of natural gas

The importation of natural gas from a nation with which there is in effect a free trade agreement requiring national treatment for trade in natural gas is deemed to be consistent with the public interest and must be granted without modification or delay.

Control theft of gas

Stealing natural gas is a dangerous act which puts everyone at risk. Tampering with or bypassing a natural gas meter in order to obtain free natural gas is illegal and can be harmful to the perpetrator as well as to others.