Decline in international oil prices Country saves $3 billion forex in 2014-15

Pakistan has saved foreign exchange worth $3 billion during fiscal year 2014-15 in the wake of decline in international oil prices, according to Pakistan Economic Survey 2014-15.
The survey says: "The falling of international oil prices saved foreign exchange due to lower import bill (an amount of $3 billion approximately will be saved) while reduction in domestic petrol prices decreased the private consumption expenditure on oil thus money saved could be spent on other goods and services.
Due to substantial decrease in retail prices on December 1, 2014 and afterwards on January 1, 2015, sales of petrol witnessed unprecedented increase," it added. An analysis of last three economic surveys showed that the natural gas production and tariff during past three years (2012-15) remained stagnant, while the demand for commodity kept on increasing.
According to Pakistan Economic Survey 2012-13 and 2014-15, local natural gas production remained 4 billion cubic feet per day (BCFD), while the government did not increase prices of the commodity since January 2013. These surveys further indicated that Pakistan's natural gas production has remained stagnant at the 4,000 million cubic feet per day (MMCFD). Thus there existed constrained demand for natural gas ie of 6,000MMCFD against a supply of 4,000MMCFD, while the unconstrained demand for gas was estimated to be 8,000MMCFD or more than double the current domestic production. One risk associated with this sector was its continuous depletion of existing natural gas fields, while the pace of new gas discoveries was slow.
Divulging into details, the survey said that Pakistan is heavily dependent on gas with total potential gas reserves of 282 Trillion Cubic Feet (TCF), out of which a little over 24TCF, are recoverable reserves with current daily production of almost 4BCFD. During 2013 total production remained 1,559 billion cubic feet - a growth of 6 per cent when compared to last year.
Last time, the Oil and Gas Regulatory Authority (Ogra) increased gas tariff in January 2013. In January 2012, the government has also imposed Gas Infrastructure Development Surcharge (GIDS) on five sectors, excluding domestic and commercial sectors. The government is now successfully importing 500MMCFD of LNG from Qatar. As per LNG Policy in 2006/2011 the project structures can be (i) integrated, in which the terminal developer arranges LNG imports as well as its buyers and (ii) unbundled, in which the terminal developer, LNG importer and LNG buyers are different. In 2014, the federal government called bids through Inter State Gas Systems (ISGS), for construction of LNG re-gasification terminal by private companies.
Engro Elengy Terminal Limited (EETL), formerly Elengy Terminal Pakistan Limited (ETPL), a subsidiary of Engro Corporation Limited, was selected as the 'Technically' and 'Financially' qualified bidder for construction of LNG re-gasification terminal at Port Qasim. EETL has signed an LNG Service Agreement (LSA) with a government's designated entity ie SSGC for handling 400MMCFD of Re-gasified Liquefied Natural Gas (RLNG) to be injected to national grid. The LNG shall be imported by the government and EETL shall provide the re-gasification services at a tolling tariff.
During July 2012 to February 2013, the two gas utilities (SNGL & SSGCL) have laid 14kms gas transmission network, 4326kms distribution and 831kms services lines and connected 261 villages/towns to gas network. During this period, the gas utility companies have invested Rs 1513m on transmission projects, Rs 11,925m on distribution projects and Rs 1,898m on other projects, bringing total investment to about Rs 15,336m. During this period, 237588 additional gas connections, including 236997 domestic, 221 commercial and 370 industrial, were provided across the country.
During July 2014 to February 2015, the two gas utilities (SNGPL & SSGCL) have laid 72kms gas transmission network, 1,040kms distribution and 758kms services lines and connected 59 villages/towns to gas network. Thus 206,473 additional gas connections, including 206,127 domestic, 249 commercial and 97 industrial were provided across the country. It is expected that gas will be supplied to approximately 419,445 new consumers during the fiscal year 2015-16.