Pakistan's ECC May Approve Shale Gas Policy

Pakistan’s Economic Coordination Committee (ECC) will likely approve the Shale Gas Framework when it meets on Tuesday.

A summary of Ministry of Petroleum and Natural Resources seeking approval of Shale Gas Framework has been sent to ECC for approval, Pakistan Observer has reported.

Pakistan is estimated to have shale gas reserves of 51 tcf and the estimated reserves of Low BTU gas is 2 tcf and tight gas of 40 tcf. Currently no shale gas is produced in the country.

Due to limited information currently available about the potential of shale gas in Pakistan, it is considered prudent to start three pilot projects of shale gas with certain special incentives to attract investors through an interim framework, Pakistan Observer said.

Under the framework, shale gas price will be set through bidding. The lowest price quote with at least commitment of minimum work program and expenditure requirement defined in framework will get the area to explore the shale gas, the newspaper said. 

In case of discovery of shale gas, the lease life shall be of 20 years with 20 years renewal possible. Each bidder shall be required to submit with a bid a bank guarantee equivalent to 25 percent of pahse-1 minimum expenditure commitment or a parent company guarantee or any other guarantee as provided in the petroleum policy 2012 and the companies where government of Pakistan has a majority shareholding will not be required to submit the guarantee.