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Profile page

Student name:
Uzma
Roll no:
CB564822
Registration no:
12-NMN-01653
Course code:
4656
Course Tutor name:
Muhammad Ullah
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ASSIGNMENT No. 1

Q no 1: Highlight the electricity resources of Pakistan. Also provide some

suggestion to increase our electricity to fulfill the need in future.
Energy Sector Overview

The Islamic Republic of Pakistan which became an independent state in 1947 is governed by a
federal parliamentary constitution. It is globally the sixth most populous country with a
population of approximately 200.000 million people and a comparatively high population growth
rate of 1.5%. Pakistan is a semi-industrialized economy with a presentable textile, food
processing and agriculture base and a per capita GDP of 1561 USD. According to the World
Bank, Pakistan has important strategic endowments and development potentials. Its labour
market is the 10th largest globally and Pakistan is number 67 amongst the global exporters. Yet,
there is a large inequality within the society (30 as per World Bank) and still 21% of the
population lives under the poverty line.

Pakistan’s Energy Mix

The primary energy supply amounts to over 70 million Tonnes of Oil Equivalent (TOE). Oil and
gas are by far the dominating sources with a share of 80%. Oil is imported from the Middle East
mainly Saudi Arabia, gas from Iran. In addition, Pakistan is consuming Liquefied National Gas
(LNG), Liquefied Petroleum Gas (LPG) and coal. Pakistan has currently, 4 power plants with a
total capacity of 755 MW; additional 3 are under construction. Nuclear power accounts for
around 1.9% of the total installed capacity in Pakistan. Hydropower has a share of 13% whereas
other renewable energies only play a minor role.

The government is supporting the use of LPG for cooking resulting in rapid investment in
production, storage and establishment of auto stations of LPG. During the FY 2016, an
approximate investment of PKR 2.38 billion has been made in the LPG supply infrastructure
whereas total investment in the sector until Feb 2016 is estimated at about PKR 22.33 billion.
During the FY 2016, the regulatory body OGRA has issued 12 licenses for operational marketing
of storage and filling plants, 37 licenses for construction of LPG storage and filling plants, 20
licenses for Construction of LPG auto-refuelling stations and one license for storage and
refuelling of LPG was issued. Further, one license for construction of production and storage of
LPG facility is also issued by OGRA which shall result in improving supply and distribution of
LPG as well as create job opportunities in the sector.
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Energy Sources

Historically, Pakistan has always been an energy importer and is highly dependent on fossil
fuels. With the rising fossil fuel prices, the cost of oil importing is creating a dent on Pakistan’s
foreign exchange reserves. The rising oil price along, with the rising demand for uninterrupted
power, is creating additional pressure on the already fragile electricity grid of Pakistan.
Therefore, to met this increasing demand, the Government of Pakistan, in its new budget for the
fiscal year 2014-2015,has allocated $340 million to its energy development portfolio. About 80%
of this budget will be spent on generating power from solar, biomass and biogas.

About USD 2.3 billion is spend annually on candles, kerosene lamps and battery-powered
flashlights by Pakistanis.

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Renewable Energy Sources

Pakistan aims at achieving 5-6% of its total on-grid electricity supply from renewables
(excluding large hydropower) by 2030. Total installed power capacity stood at 26 GW at year-
end 2016, of which 4.2 % was renewable energy.

Pakistan is blessed with a high potential of renewable energy resources, but so far, only large
hydroelectric projects and few wind and solar projects have harnessed this potential. Renewable
Energy accounts for 1136 MW presently installed capacity of solar PV, wind and biomass based
power projects. Possibilities also exist in promoting greater use of wind, solar and biomass
project.

Previously Government of Pakistan (GoP) had announced various policies and enabling
environments such as feed-in tariff/upfront tariff, tax incentives, net metering, long term
refinancing facility and micro-financing schemes for promoting corporate sector investment in
the renewable energy (RE) sector. Taking the market growth, technological developments, recent
cost reductions and new financial mechanisms into account, the GoP decided to liberate the
market and instigate more competition amongst the private sector players for delivering
electricity from RE resources (i.e. wind/solar) at optimal tariff rates. Accordingly, the GoP
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introduced tenders to call for competitive/reverse bidding for the RE power projects and the first
phase of bidding for wind power projects has been initiated.

For wind power project, the regulator recently has announced a benchmark levelized tariff as:
- for 100% foreign financing US cents 6.7467/kWh
- on 100% local financing, US cents 7.7342/kWh.
For solar power projects there is no benchmark tariff announced by the regulator as yet, however
the last upfront tariff is provided below.
Wind Energy

Pakistan has a potential for wind energy specially in the southern coast and coastal Balochistan.
The wind speed is on average 7-8 m/s at some sites along the Keti Bandar- Gharo corridor.

Particularly in the southern regions of Sindh and Balochistan, the technical potential of wind
power is high along the 1,000 km of coastline where wind speeds range between 5 and 7
m/s. The potential capacity for wind energy is estimated at 122.6 GW per year, more than double
of the country’s current power generation level. A newly completed wind farm in Gharo, Sindh
Province, is one of a series under construction in Pakistan to reduce the country's serious energy
deficit.

For more information about wind energy in pakistan, see Wind Energy Country Analyses
Pakistan
Solar PV

The solar potential is estimated to be over 100,000 MW.[5] Pakistan has a high solar potential.
Irradiation across the country is around 4.5-7.0 kWh/m²/day.
Solar Village Electrification: More than 40,000 villages which are so far from the grid that it
becomes costly and uneconomic to extend the grid to these locations are prime candidates for
village electrification using Solar Home Systems (SHS).
Solar Water Heaters and Geothermal Heat Pumps: There is a big market for investors for SWH
and GHP in domestic and industrial sectors. Only 22% of the population has access to piped
natural gas.[5]Productive use in agriculture: Solar Powered Efficient Pumps could replace the
260,000 water pumps (tube -wells) with a sanctioned load of over 2,500 MW operated with
electricity, and another 850,000 Diesel Water Pumps that consume 72,000 TOE of Diesel
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annually. Street Lights: Pakistan has over 500,000 Street Lights with a sanctioned load of over
400 MW. Most of these Street Lights are based on 80W, 125W and 250W Sodium Lights. They
offer opportunities to be replaced with Efficient Solar Lighting.
Biomass
Out of the total area of 79.6 million hectares, 21.2 million hectares are cultivated; Almost 80
percent of the cultivated area is irrigated. The country has the world’s largest contiguous
irrigation system. Forests cover 4.21 million hectares, 5% of Pakistan’s total area. According to
the FAO data, this number has dropped continuously since the 1990s to only 1.9% in 2015.

“Biomass availability in Pakistan is also widespread. Approximately 50,000 tones of solid waste,
225,000 tones of crop residue and over 1 million tones of animal manure are produced daily. It is
estimated that potential production of biogas from livestock residues is 8.8 to 17.2 billion
meters3 of gas per year (equivalent to 55 to 106 THz of energy). Large sugar industry in Pakistan
also generates electricity from biomass energy for utilization in sugar mills. Annual electricity
production from bagasse is estimated at 5,700 GWh – about 6% of Pakistan’s current power
generation level. In the present electricity crisis recently government allowed sugar mills to
supply their surplus power up to a limit of 700 MW to the national grid. It is estimated that
sugarcane bagasse can potentially be used to generate 2000 MW of electric power. However
presently it is difficult to obtain more electricity from sugar mills due to grid limitations because
most of the sugar mills are located in remote rural areas which are not even connected to the
national grid. Integration of electricity generated from biomass energy to the national grid can
ease the electricity shortage in the country.” A large number of people in rural areas in Pakistan
depend on forests for their livelihood, fuel wood and shelter. Many use the forests in
unsustainable ways to satisfy their domestic energy needs. Therefore, forest depletion and
degradation are a major challenge.

Almost all of Pakistan’s Biomass power generation is done in steam power plants, since biomass
gasification and newest fermentation technology has not been introduced in the country. The
Sugar industry has the highest utilization of biomass, with every singly sugar mill being
equipped with a biomass boiler for the production of electricity. Some even incorporate high
pressure boilers to increase efficiencies. The “Framework for Power Co-generation’ for bagasse
and biomass-based sugar industry projects”, introduced in 2013, is expected to attract 1,500 MW
to 2,000 MW in generation in the short term, between 2016 and 2018.

Hydropower
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Large Hydropower has proved to be the cheapest source of electricity. Despite the high
availability of hydro power resources low investments in this sector hamper the utilization of this
potential source.

Smaller (less than 50 MW) sites are available throughout the country. The micro - hydropower
sector has been relatively well established yet. Since the mid-80s micro-hydro power plants
supply electricity to some 40,000 rural families. Most of the plants are community-based and
situated in the Northern Areas and Chitral. Small Hydropower is considered as another
promising option for off-grid generation of electricity. Provincial governments mainly handled
the small hydropower sector: in 2014, 128 MW has been operational in the country, 877 MW is
under installation and around 1500 MW is available for further development. The potential for
micro hydro (up to 100 kW) is estimated at 350 MW in Punjab and 300 MW in northern
Pakistan.

Main Problems of the Energy Sector

According to the World Energy Outlook (2016) statistics, at least 51 million people in Pakistan
or representing 27% of the population live without access to electricity. According to IFC, the
rate of energy for poor people is even higher with approximately 36% or 67 million out of 185
million without access to electricity.[23] The National Electric Power Regulatory Authority, in
its annual State of the Industry Report, concludes that approximately 20% of all villages, 32,889
out of 161,969, are not connected to the grid. Even those households that are statistically
connected experience daily blackouts so that it is estimated that more than 144 million people
across the country do not have reliable access to electricity. As a result, Pakistani households use
a mix of technologies to power their homes and businesses.

More than 50 % of the population, mainly in rural Pakistan, relies on traditional biomass for
cooking. Common cooking fuels include firewood, agricultural waste and dung cakes. According
to a study about Balochistan and Sindh region in April 2007, it was appraised that households
use on average 920 kg of wood in winter and 560 kg of wood in summer while in Sindh the
numbers are 640 kg and 400 kg respectively. In Balochistan, around half of the population
collects their own firewood, while in Sindh most households need to buy their wood. The
burning of biomass in inefficient stoves and without proper venting or air exhaust causes serious
health problems. According to WHO estimates indoor air pollution is responsible for more than
50,000 premature death per year in Pakistan. Especially women and children are affected as they
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are most exposed to the smoke and soot from cooking. In addition the burning of wood is
contributing to deforestation which is progressing at a rate of more than 2% per year.

A survey revealed that rural households in Punjab spent on average about 9 % of the total
household income for fuel and lighting. However, poor households are forced to invest up to
25% of their monthly income in fuel, kerosene and batteries due to the dysfunctional market. In
general, non-electrified households spend USD 5 to USD 8 per month or an estimated USD 2.3
billion a year on everything from candles, to kerosene lamps, to battery-powered torches.

Due to poor distribution networks, households in rural areas using LPG as fuel pay up to 10
times more than urban households that benefit from subsidised natural gas for residential use.

Access to electricity is varying from more than 90 % electrified households in urban areas down
to only 61% in remote rural area.
The main factors which are preventing the rollout of rural electrification are the increasingly high
distribution costs and the shortage of power generation which results in breakouts as well as load
shedding. Furthermore, due to the currently very low electricity consumption/demand in rural
areas the expansion of the grid into these areas is merely not economical and hence not feasible.
Utilities and distribution companies are reluctant to roll out the grid since the “revenues from
tariffs would never be able to provide the returns needed to recover the investment.”

The main factors which are preventing the rollout of rural electrification are the increasingly high
distribution costs and the shortage of power generation which results in breakouts as well as load
shedding. Furthermore, due to the currently very low electricity consumption/demand in rural
areas the expansion of the grid into these areas is merely not economical and hence not feasible.
Utilities and distribution companies are reluctant to roll out the grid since the “revenues from
tariffs would never be able to provide the returns needed to recover the investment.” The main
factors which are preventing the rollout of rural electrification are the increasingly high
distribution costs and the shortage of power generation which results in breakouts as well as load
shedding. Furthermore, due to the currently very low electricity consumption/demand in rural
areas the expansion of the grid into these areas is merely not economical and hence not feasible.
Utilities and distribution companies are reluctant to roll out the grid since the “revenues from
tariffs would never be able to provide the returns needed to recover the investment.
Population without electricity
National electrification rate
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The demand for electricity in Pakistan has increased dramatically within the last 5 years. Over
half of this demand originates from the Punjab province where the majority of the population
resides. Households are mainly responsible the increase of demand. The high demand of industry
and local entrepreneurs in turn cannot be met either. The recent rise in demand is, in part, due to
the large-scale instalment of cooling and air-conditioning systems, particularly in urban areas. As
a result, the demand is especially high in the summer months. In the Punjab electricity demand
often exceeds the available supply by 2 to 3 GW, which makes up around 30% of the total
installed capacity. Therefore, many businesses and industries, as well as private households, have
resorted to installing diesel generators as back-up which has led to a substantial increase in the
cost of electricity in cities across Pakistan. The main factors which are preventing the rollout of
rural electrification are the increasingly high distribution costs and the shortage of power
generation which results in breakouts as well as load shedding. Furthermore, due to the currently
very low electricity consumption/demand in rural areas the expansion of the grid into these areas
is merely not economical and hence not feasible. Utilities and distribution companies are
reluctant to roll out the grid since the “revenues from tariffs would never be able to provide the
returns needed to recover the investment.”

Overall Pakistan is struggling with a large gap between electricity supply and a demand of about
5 GW. Main reasons for low investments in power generation are tariffs below cost recovery
levels, power theft, insufficient collection rates, and technical losses of around 23-25%. As a
result, power generation companies face serious financial problems, making investments in the
sector very difficult. In addition, costs of power generation, which is mainly based on fossil
fuels, are very high averaging at around 12PKR/kWh and up to 15PKP/kWh if technical losses
are included. The main factors which are preventing the rollout of rural electrification are the
increasingly high distribution costs and the shortage of power generation which results in
breakouts as well as load shedding. Furthermore, due to the currently very low electricity
consumption/demand in rural areas the expansion of the grid into these areas is merely not
economical and hence not feasible. Utilities and distribution companies are reluctant to roll out
the grid since the “revenues from tariffs would never be able to provide the returns needed to
recover the investment.” Due to high costs, the government subsidises electricity tariffs, in order
to make them more affordable for consumers. In 2013, government subsidies for electricity
reached 1.3 billion USD, however, this did not recover the costs of generation, transition and
distribution. “This creates a budget gap that curtails public investment in primary infrastructures,
essential for the economic development of the country.” The main factors which are preventing
the rollout of rural electrification are the increasingly high distribution costs and the shortage of
power generation which results in breakouts as well as load shedding. Furthermore, due to the
currently very low electricity consumption/demand in rural areas the expansion of the grid into
these areas is merely not economical and hence not feasible. Utilities and distribution companies
are reluctant to roll out the grid since the “revenues from tariffs would never be able to provide
the returns needed to recover the investment.”
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The growth of power generation capacities is slow. The declining availability of natural gas in
Pakistan often results that existing power plants operating below capacity. Gas has increasingly
to be substituted with oil, which is mainly imported (75%). Nevertheless, the country’s reliance
on its internal natural gas resources has even increased in the last years, mainly due to rising
international oil prices which in turn has led to increase in cost of businesses, pressure on
household budgets, especially of lower middle income groups and burden on national exchequer
in terms of subsidies. The main factors which are preventing the rollout of rural electrification
are the increasingly high distribution costs and the shortage of power generation which results in
breakouts as well as load shedding. Furthermore, due to the currently very low electricity
consumption/demand in rural areas the expansion of the grid into these areas is merely not
economical and hence not feasible. Utilities and distribution companies are reluctant to roll out
the grid since the “revenues from tariffs would never be able to provide the returns needed to
recover the investment.”

As a result of the insufficient power supply, the unused capacities, and the power losses, Pakistan
is facing serious power blackouts on average 10-12 hours a day. The substantial load shedding
affects enterprises, social institutions and even individual households, and thus hampers
considerably the economic and social development of the country.

Policymakers neglect in energy planning and energy policies non-commercial/traditional energy

sources which are not even represented in national statistics (only electricity and mining). This
means that almost 50 % of the consumers which are mainly rural households are ignored in
energy planning and the public investments for supply of power.
Moreover, Pakistanis also among the Top 10+1 countries with largest number of people using
solid fuels for cooking as shown below in graph.
According to the International Energy Agency, in 2011, Pakistan’s population will rise to over
100 million people by 2030, with Pakistan rising from among the top 10 to being among top 5
countries with the highest proportion of population without access to modern energy.

Policy Framework, Laws and Regulations Regarding Energy Access

Government of Pakistan and provincial governments are aware of the need to improve the energy
situation in the country through various policies and projects. In this regard, relevant
organizations have been developing and implementing policies from time to time to bring clarity
to their future approach towards the energy crisis situation in the country.

The Government of Pakistan only in 2013 mentioned the universal access as a goal in the
“Vision 2025”. Before that, rural electrification was not a priority and also renewable energy
policies were only introduced in 2006 and did not include biomass regulations until 2013.
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The relevant policies for Pakistan are mentioned below (order: newest first).

Pakistan's nationally determined contribution (PAK-NDC), 2016

Pakistan handed in its first NDC in November 2016. Among the Mitigation Options in Energy
Demand Sector with high priority, the NDC lists also improved cookstoves and solar water
heaters: Efficient stoves are considered as cheap option to provides tangible and visible benefits
to a very large portion of population and and simultaneously harness the mitigation potentials
since the cost per device of ICS is low.

While it acknowledges the fact that “solar photovoltaic and thermal technologies for power
generation, water pumping, solar geysers and other renewable energy-uses can curtail GHG
missions”[41], it does not refer specifically to off-grid solar or mini-grids. It only refers to
“Large scale and distributed grid connected solar, wind and hydroelectricity, as “these three
options represent the three distinct renewable energy options believed to be viable for Pakistan.
Their potential as low-carbon sources of energy and their perceived cost-effectiveness warranted
their inclusion in the analysis”

Among the climate-related activities for the budget year 2016-2017, planned “key initiatives
include interest-free loans to farmers for installation of solar tube wells; abolishing tax duty for
import of solar equipment, promoting other renewable technologies in meeting the energy needs
of the country and ambitious plans of afforestation.”

National Energy Efficiency and Conservation Act, 2016

The law mandates the creation of authorities to improve energy efficiency and conservation
mechanisms. The authorities created under this bill are the National Energy Efficiency &
Conservation Authority (NEECA); the Fund of NEECA; and the Pakistan Energy Conservation.

The pakistan energy efficiency and conservation act

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Pakistan Net Metering Policy for Solar PV and Wind Projects, September
2015

Solar PV and wind generators under 1 MW of capacity are allowed to sell back produced
electricity to the national grid. The payment for purchase of electricity from distributed solar and
wind generation units shall be the same as the off-peak electricity rate charged by utility
companies for electricity sold to distributed solar and wind generation units. Residential,
commercial and industry scale owners of the eligible generators can participate in the scheme.
As of today November 2019 more than 2100 licenses on net metering issued with total capacity
39MWp.

Power Generation Policy, 2015

This policy addresses the hydropower projects and the thermal power projects. Under this policy,
the GOP encourages public-private partnership and in scope of this policy, the
incentives/concessions available to private power projects will also be available to projects
implemented under PPP mode in accordance with the applicable laws.

The main objectives of this policy are to provide sufficient power generation capacity at the least
cost; to encourage and ensure exploitation of indigenous resource; to ensure that all stakeholders
are looked after in the process; a win-win situation; and to be attuned to safeguarding the
environment.

National Power Policy 2013, 2013

Central part of the government’s plan to support the current and future energy needs of the
country. With the three focus points Efficiency, Competition, Sustainability, it outlines
incentives to attract more private investments and infrastructure development, and schemes that
will allow public-private partnership. Further, it aims to diversify the energy mix, and the role of
renewable energy is gaining significance in achieving sustainability and energy
security.[19] Among 9 other major aspects – it gives the directive to “ensure the generation of
inexpensive and affordable electricity for domestic, commercial, and industrial use by using
indigenous resources” and to “align the ministries involved in the energy sector and improve the
governance of all related federal and provincial departments as well as regulators”.
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It sets out 25 goals in accordance to 7 pillars. Among them, Pillar IV: Energy, Water & Food
Security, with the following goals concerning energy:

Energy: double power generation to over 45,000 MW to provide uninterrupted and affordable
electricity, and increase electricity access from 67% to over 90% of the populationEnergy: (a)
reduce average cost per unit by over 25% by improving generation mix (15%) and reducing
distribution losses (10%); (b) increase percentage of indigenous sources of power generation to
over 50%; and (c) address demand management by increasing usage of energy efficient
appliances/products to 80%.

The elimination of current energy demand-supply gap by 2018 and optimizing the energy mix of
oil, gas, hydro, coal, nuclear, solar, wind and biomass are some of the key priorities of the policy.

Alternative and Renewable Energy Policy, 2011 (Medium term policy)

As a medium term policy, the Renewable Energy Policy (2006) was updated to Alternative and
Renewable Energy Policy, 2011. This policy is currently in force and builds upon the short term
policy by:

Resolving policy conflicts and addressing stakeholder concerns.Developing the concept that
ARE projects actually cost the nation less and thus deserve and require better rate of return than
fossil fuels.Developing the policy of non-electric RE and a policy for Biofuels.Expanding
incentives for alternative energies such as: the Alternative Energy Development Fund, partial
resource risk coverage, tariffs on the basis of a premium rate of return for developers, mandatory
grid connection, mandatory purchase requirements, small business programmes for ARE (<10
MW), Asian Development Bank (ADB) loan guarantee facility, credit market facility and 100%
carbon credits to Independent Power Producers.

Policy for Development of Renewable Energy for Power Generation. Employing Small Hydro,
Wind, and Solar Technologies, 2006 (short term policy)

This was the first policy implemented by Government of Pakistan that firmly supported
renewables in the national energy mix. It also provided a policy framework for upscaling
renewables. It was developed as a short-term policy with a view to develop a long term policy. It
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is tentatively valid until 2018.The goal of this policy was to provide 10% of Pakistan’s energy
supply mix by renewable technologies by 2015 focusing on the following technologies:

Small hydro of 50 MW or less capacity Solar photovoltaic (PV) and thermal energy for power
generation and Wind power generation

Other technologies such as those based on municipal waste and landfill methane recovery,
anaerobic or pyro lytic biomass gasification, co-firing or cogeneration utilizing agricultural crop
residues, bio-fuels, wave, tidal, geothermal energy, and fuel cells were not yet dealt with in this
policy. It did, however, mention the goal of universal access to electricity.

Features of this policy are:

It invites investment from private sector for Independent power projects, or IPPs (for sale of
power to the grid only), Captive cum grid spill over power projects. (i.e., for self-use and sale to
utility), captive power projects (i.e., for self or dedicated use) and isolated grid power projects
(i.e small, stand-alone). Except for IPPs, the other projects do not require any LOI, LOS or IA
from the government
Electricity purchase from qualifying renewable energy-based generation projects is mandatory
Net metering and billing Delicences and deregulates small scale power production from
renewable resources (up to 5 MW for hydro and 1 MW for net metered sales)Simplified and
transparent principles of tariff determination Facilitates projects to obtain carbon credits for
avoided greenhouse gas emission.

In order to fulfil the objectives of the policy (1. Energy Security 2. Economic Benefits 3. Social
Equity 4. Environmental Protection), the GOPs strategy include to:

Increase the deployment of renewable energy technologies (RETs) in Pakistan so that RE

provides a higher targeted proportion of the national energy supply mix, i.e., a minimum of 9,700
MW by 2030 as per the Medium Term Development Framework (MTDF), and helps ensure
universal access to electricity in all regions of the country. Provide additional power supplies to
help meet increasing national demand. Introduce investment-friendly incentives, and facilitate
renewable energy markets to attract private sector interest in RE projects, help nurture the
nascent industry, and gradually lower RE costs and prices through competition in an increasingly
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deregulated power sector. Devise measures to support the private sector in mobilizing financing
and enabling public sector investment in promotional, demonstrative, and trend setting RE
projects. Optimize impact of RE deployment in underdeveloped areas by integrating energy
solutions with provision of other social infrastructure, e.g., educational and medical facilities,
clean water supply and sanitation, roads and telecommunications, etc., so as to promote greater
social welfare, productivity, trade, and economic wellbeing amongst deprived communities. Help
in broad institutional, technical, and operational capacity
Facilitate the establishment of a domestic RET manufacturing base in the country that can help
lower costs, improve service, create employment, and enhance local technical skills.

Q no 2: Analyze the industrial policies of Pakistan and role of policies in the

economy of Pakistan.
Answer: The period from 1947 when Pakistan was created to the watershed of 1971 when East
Pakistan split off to become Bangladesh is an important one for studying the determinants of
industrial performance in the Indian subcontinent. On the one hand, despite substantial
differences in the industrial policies of Pakistan and India, their rates of industrial growth were
remarkably similar. On the other hand, while Pakistan’s authoritarian institutions had many
features similar to contemporary East Asian states, in particular South Korea, its long run
performance was much poorer than in the East Asian industrializers.
1. The Issues Pakistan’s early industrial development in the fifties was based on import
substituting industrialization under tariff barriers and an overvalued exchange rate. After
the first easy phase of import substituting industrialization, industrial strategies evolved
into a more coherent industrial policy in the sixties under Ayub’s military regime which
took over in 1958. Industrial credit was subsidized and its allocation was controlled by
the state through two publicly owned industrial banks. At the same time, enterprises were
set up in the public sector and subsequently divested as running ventures to the private
sector. Incentives were offered to exporters under an innovative “Bonus Voucher”
scheme to promote exports. This period produced some of the highest industrial growth
rates ever enjoyed by either Pakistan or post-1971 Bangladesh. Yet, the industrial policy
of the sixties collapsed as political opposition to it grew in both East and West Pakistan.
2. Pakistan is deindustrializing prematurely. The role of manufacturing in the economy has
declined and its rate of growth lags far behind India, Bangladesh and Sri Lanka. As a
result, over the last decade and a half, Pakistan has lost share of world exports, whilst
Bangladesh’s share doubled and Vietnam’s grew seven-fold in the same time period.
Manufactured goods represent a lower percentage of Pakistan’s exports than those of
Bangladesh. Disproportionate burden of taxes on industry, rampant under-invoicing,
misdeclaration of imports, blatant availability of smuggled goods, a fiscal policy that
relies on imports for revenue and fails to encourage capital formation and consolidation,
together with knee-jerk measures to meet tax revenue shortfall have thwarted the growth
of industry. A tariff policy that fails to adequately differentiate between raw materials,
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intermediate goods and finished products has resulted in rapid growth of imports, often
negating the positive impact that trade agreements could bring through cheaper raw
materials. As a result, Pakistan is not integrated well into global value chains. Poorly
negotiated trade agreements have failed to secure competitive tariffs for exports. High
input costs impede the competitiveness of relatively low value-added, heavily textile-
reliant exports.
3. Shortfall in availability of cotton inflates imports and impacts the potential of value-
added exports. Subsidies for sugar cane and wheat create uneconomic surpluses, denying
industry adequate inputs to add value to, both for exports and import substitution. Short-
term oriented export policies have not encouraged the shift to man-made fibers in line
with global demand. Neither has it promoted investment in adding further sophistication
to products or to diversify beyond the traditional markets of USA and Europe. Energy
shortfall, high cost and generally anti-manufacturing policies have also discouraged the
broadening of exports beyond textiles or of import substitution. The net result of the
aforementioned is a growing trade deficit and recurring cycles of external account crises;
resulting in Pakistan knocking on IMF and other donor’s doors for the 13th time in 28
years. There is a dire need to conduct fundamental reforms to restructure the economy
and strengthen domestic industry. Besides, the country needs to generate 2-3 million jobs
for the youth who reach the age of employment every year and for the 5-6 million
currently unemployed.

Q3: discuss the major oil refineries of Pakistan and their role and contribution
in the petroleum sector in Pakistan.

Answer: Petroleum companies of Pakistan

1. 1. Petroleum Companies Working In Pakistan Local + international 1Qunber Bilal
2. 2. Page of Contents History of Petroleum in Pakistan Current status of Petroleum in
Pakistan Introduction to Petroleum Industry Downstream Industries Upstream
Industries 2
3. 3. History  First exploration well in 1866 at Kundal seepage  13 wells between 1885 to
1892 and produced 25000 bbl  First commercial discovery in 1915 drill at Potwar Basin.
 396 wells drilled at this site in 1915 to 1954  Drilling in Toot field of 122.6 sq. km in
1964 3
4. 4. Current Status Oil  Production 100,000 bpd  Consumption 350,000 bpd Gas 
Production 4.5 billion cubic feet per day  Demand 6.2 bcfd  Total exploratory wells
drilled in Pakistan are 653.  Total Oil & Gas discoveries in Pakistan are 185. 4
5. 5. 5 Petroleum industry Upstream E & PServices Downstream Marketing Companies
Refineries
6. 6. 6 E & P Services Refineries Marketing Companies
7. 7. Downstream Industries Marketing Companies & Refineries 7
8. 8. Marketing Companies PSO SHELL CALTEX TOTAL SSGC SNGPL 8
9. 9. Refineries 9
10. 10. Upstream Industries SERVICES, OPERATOR COMPANIES 10
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11. 11. 11
12. 12. Services Companies Schlumberger Weatherford Halliburton Sprint 12
13. 13. s  Established in 1926 in France by Schlumberger Brothers  Got name
Schlumberger Ltd. in 1956  World’s largest services setup  Headquarters in Houston 
105,000 employees  In Pakistan  Islamabad, Lahore, Karachi 13
14. 14.  Domain  Seismic acquisition and processing  Formation evaluation & well
testing  Well cementing and stimulation  Software and information management 
Ground water extraction 14
15. 15.  Established in 1941 as Weatherford Spring Company  Got name Weatherford Oil
Tool Company (WOTCO) in 1948  Headquarters in Switzerland  65,000 employees 
In Pakistan  Head offices Islamabad 15
16. 16.  Domain  Drilling  Surface Evaluation  Completion  Production  Intervention
 More sand screen systems installed worldwide than any other company 16
17. 17.  Established in 1919 in UAE as HOWCO  Got name Halliburton Company in 1961
 Headquarters in Houston, USA  70,000 employees  Pakistan  Islamabad 17
18. 18.  Domain  Drilling  Surface Evaluation  Completion  Production 18
19. 19.  Operating in several African, Middle East and Asian Countries  More than 500
employees  Head offices in Abu Dhabi, Dubai  Pakistan  Islamabad, Karachi, Lahore
 Domain  Coiled Tubing Services  Primary and Remedial Cementing Services 
Stimulation Services  Surface Testing 19
20. 20. Operator Companies 20
21. 21. Operator Companies  British Petroleum (BP) Pakistan  ENI Pakistan  OMV
Pakistan  MOL Pakistan  BHP-Billiton Pakistan  Oil & Gas Development Company
Ltd. (OGDCL)  Pakistan Petroleum Ltd. (PPL)  Pakistan Oilfields Ltd. (POL)  Mari
Petroleum Company Ltd. (MPCL)  United Energy Pakistan (UEP) 21
22. 22. British Petroleum  Incorporated in 1909 as Anglo-Persian Oil Company  Got name
British Petroleum in 1954.  The 3rd largest global energy company  Head offices in
London, England  In Pakistan: Islamabad and Karachi.  Total employees 84,500 all
over the world 22
23. 23. British Petroleum Domains  Exploration  Field Development  Refining 
Marketing of: Fuels Lubricants Petrochemicals 23
24. 24. British Petroleum  Production Statistics in Pakistan for 2014: 34.5 billion cubic
meters of natural gas 32.5 thousand barrels per day  Recently active in Pakistan at: 
Digri (Sindh) Sanghar (Sindh) 24
25. 25. ENI Pakistan  Founded on February 10, 1953  Aim to form  11th largest
industrial company in the world  Head offices are in Italy and Pakistan  In Pakitan:
Karachi  Total employees are 77,838 all over the world 25
26. 26. ENI Pakistan Domains  Exploration  Field development  Production  Trading
and shiping of natural gas  Electricity  Fuels and petrochemical products 26
27. 27. ENI Pakistan  Production statistics in Pakistan for 2014: 30.26 billion cubic
meters of natural gas 63 thousand barrels per day of oil  Recently active in Pakistan at:
Bhit/Bhandra Sawan Zamzama Lundali 30Km in the west of Bhit Block 27
28. 28. OMV Pakistan  Established in 1956  One of the largest oil and gas groups in
Central Europe  Started its international E&P business with first international venture in
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Libya  Head offices are in Vienna and Pakistan  In Pakistan: Islamabad  Total
employees are 25,501 all over the world 28
29. 29. OMV Pakistan Domains  Exploration  Production  Refining  Marketing 29
30. 30. OMV Pakistan  Production figures in Pakistan in 2014: 43.2 million cubic meters
of natural gas 60 billion berrls per day of oil  Recently active in Pakistan at: Latif
South-1 Exploration Well 30
31. 31. MOL Pakistan  Established on October 1, 1991  Central Europe's leading oil and
gas group.  2000 services stations in Central and Eastern Europe  Head offices are in
Hungry, Europe, Middle East  In Pakistan: Islamabad  Total employees are 31,471 all
over the world and 500 in Pakistan 31
32. 32. MOL Pakistan Domain  Exploration  Production  Refining  Distribution 
Marketing  Trading  Power generation 32
33. 33. MOL Pakistan  Production statistics in Pakistan for 2014: 32.5 million cubic
meters of natural gas 66.35 thousand barrels per day of oil  Recently active in Pakistan
at: Tal, Margala and Margala Naorth Ghouri 33
34. 34. BHP-Billiton  Established in 2001 from merger of ; Broken Hill Propriety Limited
- BHP (Incorporated in 1885) Anglo - Dutch Billiton (Incorporated in 1860)  The
largest mining company in Pakistan  Head offices are in Melbourne and London  In
Pakistan: Islamabad  Total employees are 47,044 all over the world 34
35. 35. BHP-Billiton Domain  Exploration  Production  Production statistics in Pakistan
for the year of 2014 is: 35.5 million cubic meters of natural gas 26.70 billion barrels
per day of oil 35
36. 36. OGDCL  Incorporated on Mar 4, 1961  Head office: Islamabad  11000
employees on its payroll.  Production Statistics:  Oil production is 40,367 bbl/day. 
Gas production is 1136.4 Mcf/day  LPG production is 202 metric tons/day 36
37. 37. OGDCL  The remaining recoverable reserves: More than 142 million barrels.  In
2013:  Revenue Rs. 223.365 billion  Profit before tax soaring Rs. 90.777 billion. 
Recent activities: Operating in many fields all over the country. E.g., Qadirpur, Pirkoh,
Sadkal, Dhodak, Kunnar, Tando Alam & Panjpir 37
38. 38. 38 Sindh Punjab Baluchistan KPK Tando Alam (Oil) Fimkassar (Oil) Loti (Gas)
Chanda (Oil) Lashari (Oil) Missa keswal (Oil) Uch (Gas) Mela (Oil) Thora (Oil) Toot
(Oil) Pirkoh (Gas) Nashpa (Oil) Sono (Oil) Chak Naurang (Oil) Missan (Oil) Kal (Oil)
Pasakhi (Oil) Rajian (Oil) Bobi (Gas/Condensate) Bahu (Gas) Qadirpur (Gas)
Nandpur/Panjpir (Gas) Kunnar/Kunnar Pasakhi Deep(Gas/Condensate) Dakhni
(Gas/Condensate) Norai Jagir (Gas/Condensate) Dhodak (Gas/Condensate) Daru
(Gas/Condensate) Sadqal(Gas/Condensate) Hundi/Sari (Gas) Sinjhoro (Gas/Condensate)
Nur (Gas/Condensate) Bagla (Gas/Condensate) Maru-Reti Gas Field Sari (Gas Field)
39. 39. PPL  Founded on Jun 5, 1950.  Head Office: Karachi  2700 employees are
currently working in PPL.  Discovery of Pakistan’s largest Gas Reserves at Sui in 1952.
 Production Statistics:  Oil production is 5060 bbl/day  Gas production is 830
Mcf/day  Gross gas production  1 bcf per day (20% of total) 39
40. 40. PPL  PPL’s recent proven recoverable reserves  2.012 (Tcf) of natural gas 
17.041 (MMbbl) of oil  309,918 (tons) of LPG.  The main fields of PPL includes Sui,
Adhi, Kandhkot and Mazarani. 40
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41. 41. POL 41  Founded on Nov 25, 1950.  Discovered Oil at;  Karsal in 1960  Meyal
in 1968.  Head offices in Morgah & Rawalpindi  Recent employees about 1000
42. 42. POL  Production Statistics:  Oil production is 6333 bbl/day  Gas production is
35 Mcf/day Presently operating in 9 development and production fields including;
Pariwali, Joyamari, Mianwali, Dhulian, Khaur, Pindori and Balkassar 42
43. 43. MPCL  Founded In 1957 as Esso Eastern Inc.  Named MPCL after Mari Gas Field
in 1983  Head Office: Islamabad  Employees about 5000  Production Statistics: 
Gas production is 3.5 TCF/day.  Up till now, the company has drilled about 120 wells
from which we are taking the production of gas. 43
44. 44. MPCL  The Gas in place is 10.53 TCF.  Initial gas reserve estimate of 3 TCF
which were enhanced to 6.8 TCF thus making Mari the country’s 2nd largest gas field. 
MPCL revenue Rs. 31.4 billion.  The remaining recoverable reserves  More than 4.26
trillion cubic feet of gas. 44
45. 45. UEP  Initially a subsidiary of BP Pakistan  Assumed control in September, 2011. 
Head Office: Karachi  About 1000 employees  Operating in the fields of: Badin,
Tando Muhammad Khan, Tando Allahyar, Thatha, Hyderabad, Matiari, Sanghar, and
Mirpurkhas.  The company is going to explore the areas of Digri and Sanghar South. 45
46. 46. Restraints to Progress Some of the business challenges to Operator Companies are: •
Crude oil price • Environmental risks • Exploration and drilling risks • Exchange rate •
Law and order • Legislation • Reserve Depletion • Under performance of oil and gas field
46

Q4: highlight the hydel and thermal power projects in Pakistan. Also discuss the
production of electricity and its distribution.
Answer :
Introduction Pakistan is a water-rich country but, unfortunately, Pakistan’s energy market
investment in hydel power generation has been caught up in confusion and paradoxes for more
than a decade, and no significant progress has been achieved so far. On the other hand, the
Government is trying to facilitate private investors to promote hydel power generation in the
country. Hydropower is a primary domestic source of energy. Pakistan is endowed with a hydel
potential of approximately 41722 MW, most of which lies in the North West Frontier Province,
Northern Areas, Azad Jammu and Kashmir and Punjab. Electric power is a stimulator for the
socio-economic uplift of the country. However, only half of the country’s population has access
to electricity. After the creation of Pakistan, the country faced numerous problems including
dearth of electrical power. Hydropower development in the IndoPak subcontinent started in
1925, with the construction of the Renal a 1 MW hydropower station. After a decade, the 1.7
MW Malakand-I hydropower station was built, which was later upgraded to a 20 MW capacity.
Subsequently, in 1953, the 20 MW Dargai hydropower station was commissioned. At the time of
independence, Pakistan inherited a very small power base of only 60 MW capacity for its 31.5
million people. At the time of creation of WAPDA in 1958, the country’s total hydel potential
capacity was enhanced to 119 MW. By the Indus Water Treaty in 1960, it was decided that
Pakistan is entitled to 142 MAF (Indus 93, Jhelum 23 and Chenab 26) of water utilization.
Subsequently, 240 MW Warsak, 1000 MW Mangla and 3478 MW Tarbela Hydropower Projects
were constructed. For the success of economic activities, electricity is a basic ingredient. The
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total installed capacity of the hydropower stations in the country is about 6595 MW, out of
which 3767 MW is in NWFP, 1698 MW in Punjab, 1036 MW in AJK and 93 MW in the
Northern Areas. However, an abundant hydel potential is still untapped which needs to be
harnessed. This report has been prepared on the basis of data available in this office and
information obtained from various organizations. The report provides information on the
following: • Projects in Operation • Projects under implementation in the public sector • Projects
under implementation in the private sector • Projects with Feasibility Study completed • Projects
with Pre-Feasibility Study completed / “Raw Sites” In Pakistan, hydel resources are mainly in
the north, however, in the south there are scarce hydel resources available. Comprehensive detail
of total hydel potential in Pakistan is at Appendix-I. The hydel potential of Pakistan can be
divided into six sectorial regions, namely: • NWFP • Punjab • Azad Jammu & Kashmir Private
Power & Infrastructure Board 3 • Northern Areas • Sindh • Balochistan The Government of
NWFP has established a corporate body known as the Sarhad Hydel Development Organization
(SHYDO) for carrying out hydro-power prospects, hydro-power development and to act as a
utility company for isolated rural communities. With the assistance of WAPDA and GTZ,
SHYDO prepared a Master Plan for the development of hydro-power potential in NWFP.
Accordingly, the Regional Power Development Plan was completed with pertinent technical and
financial data of different hydel sites in NWFP. About 150 potential sites, with a total capacity of
18698 MW were identified on the basis of high, medium and small head. Out of these, 17
projects are in operation, 6 sites are under implementation in the public sector and 1 site has been
offered to the private sector. Mainly, these are run-of-river sites, with some as daily storage
projects. In Punjab, the Punjab Power Development Board was created in the Irrigation
Department in 1995, for the promotion of hydel power generation on canal sites in Punjab. At
different canals, about 324 potential sites of medium and low head, with a total estimated
capacity of 5895 MW were identified. Recently, WAPDA has launched the 1450 MW Ghazi
Barotha hydel project as a run-of-river project . In order to exploit the plentiful hydel resources
of AJK, the Government of AJK (GOAJK) established the AJK Hydro Electric Board (HEB) in
1989. The AJK HEB successfully completed the 1.6 MW Kathai, 2 MW Kundel Shahi, 2 MW
Leepa, and 30.4 MW Jagran hydel power projects. Subsequently, with the intention of providing
a one-window facility and to encourage the development of hydel potential in the private sector,
the GOAJK created the AJK Private Power Cell (PPC) in 1995. A number of hydel projects with
the total capacity of 829 MW are being processed/undertaken by the private sector. Numerous
promising potential hydel sites have been identified in the Northern Areas but, due to the absence
of high power transmission lines, these sites have not been developed so far. On account of
difficult mountainous terrain and the absence of high power transmission line system, the
Northern Areas are not connected to the National Grid and no projects have been undertaken by
private investors. The Northern Areas Public Works Department (NAPWD) was established,
which is responsible for the generation and distribution of electrical power. NAPWD has
constructed various mini hydel power stations in the region and has built 11 KV lines for the
transmission of power to consumers. A 18 MW Naltar-III Hydropower Project is under
implementation in public sector. Currently, approximately 40 % of the local population of
Northern Area has been provided with electrical power. The Irrigation & Power Department,
Government of Sindh is responsible for conducting hydropower activities in the Province, and
for facilitating and liaison with the concerened agencies. Six potential sites of an estimated total
capacity of 178 MW have been identified with medium 4 Private Power & Infrastructure Board
Private Power & Infrastructure Board 5 and low head at different canals. The hydropower
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projects identified in the Province are Nai Gaj Fall, Sukkur (Indus /Nara Canal), Rohri canal and
Guddu Barrage Projects. These projects have an estimated 178 MW capacity. Feasibility studies
of the Rohri and Guddu Barrage Projects have been completed, and it is expected that
implementation work will be started in the near future. Presently, no hydel projects are in
operation or under implementation, either in the public or private sectors. The National Water
Resources Development Programme for Balochistan included 8 irrigation projects, but none of
them have the required head to generate electricity. Presently, no hydel projects are in operation
or under implementation in the public sector, and no projects are being processed/undertaken by
the private sector. In order to facilitate investors to participate in the development and
implementation of hydel projects data pertaining to the hydel projects in operation, under
implementation in public/private sector, feasibility studies and pre-feasibility studies has been
compiled and is presented in the report.

Q no 5: Write the benefits and disadvantages of the rapidly increasing

population growth rate of the country.
Answer: WHY POPULATION MATTERS
“All our environmental problems become easier to solve with fewer people, and harder — and
ultimately impossible — to solve with ever more people.”
– Sir David Attenborough, Population Matters patron

Human population has grown beyond Earth's sustainable means. We are consuming more
resources than our planet can regenerate, with devastating consequences.

It took humanity 200,000 years to reach one billion and only 200 years to reach
seven billion. We are still adding an extra 80 million each year and are headed towards 10
billion by mid-century. Rapid human population growth exacerbates all environmental
problems.

Overpopulation
Overpopulation is a major cause of most of the world’s problems. Whether it is a question of
food shortage, lack of drinking water or energy shortages, every country in the world is affected
by it – or will be.

Partly thanks to the import of goods from abroad, any particular country is able to maintain its
own welfare. But this cannot go on in an unlimited way. In fact, the number of inhabitants is
rising in every country. The world population is threatening to rise in the next few decades to 8
or 10 billion. There is a good chance that more and more countries will need their own products
themselves.

Our planet can offer a quality of life comparable to that enjoyed in the European Union to no
more than 2 billion people. With a population of 8 to 10 billion, welfare per person on a world
scale will drop to that of a poor farmer who can scarcely provide sufficient food for himself and
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knows nothing of welfare. And thus we will have to share everything fairly in order to avoid
disputes or war.

The climate is changing – and it matters little whether this can be blamed on human activity or
on changes in the solar system. The sea level only has to rise slightly in order to cause a great
deal of valuable agricultural land to disappear. At present we seem to think that we can keep
ahead of famine with the use of artificial fertilisers, by the inhumane breeding of animals and
other survival strategies.

Human beings have a tendency to want more and more welfare. World-wide the numbers of cars
and refrigerators are increasing before our very eyes. But there will come a time when population
growth and welfare collide. There is a reasonably good chance that floods of people will trek all
over the world searching for more food and welfare.

Technicians are only too happy to point to technology that has solutions to all our problems up
its sleeve. Unfortunately technical solutions have not as yet been able to combat world hunger in
any significant way. Wherever there is no recognition or solving of the problems on a worldwide
scale, war and violence would seem to be inevitable: everyone wants to survive.

The only solution is a population policy applied on a worldwide scale. This site provides you –
per language and, where possible, per country – with articles, films and images from all over the
world showing what overpopulation is and why a population policy is important. Unfortunately
too often any discussion of overpopulation or of population policies is taboo.

The business world and the religions are generally only interested in population growth.
Allowing welfare to shrink is often just as difficult for the rich as fleeing from poverty is for the
poor. In addition the growth scenario continues to dominate worldwide thinking about solutions
for the problems set out here.

We would like to invite you to acquaint yourself with the contents of this site. We also welcome
any multi-media contributions you might make. The Dutch foundation CVTM (the Ten Million
Club), a non-profit organisation, has made this site possible. You can also support us with your
contributions via the site.

Advantage: Industrial, Medical, and Agricultural Innovation

Many of the world's most remarkable innovations over the past 300 years are attributable to
population growth. Even more great minds lead to more innovations. Assembly-line
manufacturing itself is an adaptation to an increasing population and the need for greater and
faster output. More people around the world are living longer lives than even a century earlier
thanks to modern medical achievements. And while agricultural resources are a very real concern
as the world's population grows, the world's increase in population is responsible for a greater
consciousness of the need for additional resources as well as the innovations to produce food at
the pace of population growth.

2Advantage: Economic Growth

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A growing population can generate economic growth. The birth of more people equates to a
greater number of parents investing in their youth. Increased purchases in products such as food,
clothing, education-related expenses, sporting goods and toys feed the economy. Parents with
small children purchase larger homes with more bedrooms and bathrooms to ensure they have
enough room for their children. Construction of larger homes feed the building and home
improvement industries economically. As the population grows, so does economic spending.

3Disadvantage: Food Shortage

Unchecked population growth without equal agricultural advancement to meet it leads to food
shortages. Fortunately, agricultural supply worldwide currently exceeds the demand of the world
population. If the population was to show signs of increasing, support for agricultural
development would be required. Slowing population growth combined with modern agriculture
make it difficult to estimate a point when the population's demand for food outweighs the supply.
Food distribution does remain a concern in some areas of the world.

4Disadvantage: Property Shortage

Although the world population is a long way from being large enough to occupy all of the
habitable land on earth, unchecked population growth can inspire overcrowding and civil unrest.
Areas with high populations experience this now. An increase in population growth would
necessitate an investment in the development of less desirable areas on earth, to meet space need
demands.

5Disadvantage: Aging Dependency

The world's growing population includes a large and dependent aging segment. In the United
States, the aging population, defined by people over the age of 65, is expected to comprise
almost 20 percent of the population by 2030 -- an 80 percent increase from 2000. Changes in
population distribution such as this one can make a society assess how it cares for certain
populations and how it allocates resources for such care.