Pakistan in its early days of independence was blessed with rich deposits of natural gas. A large field was discovered in 1952 at Sui in Balochistan Province. After its development, Sui field started supplying gas to various cities. After this success, exploration activity took pace and over the years many new field have been discovered.
So far about 53 TCF gas reserves have been discovered within the country out of which 23 TCF gas has been consumed. Since success rate in our country has remained exceptionally high, it has attracted huge foreign investment. Well known international E&P Companies such as, BHP, OMV, MOL etc have been successful in their exploration activity in Pakistan and are producing large quantities of Oil and Gas. These multinational Companies in addition to bringing foreign investment have also introduced state of the art technology for drilling.
During the year 2008-09, Pakistan has been able to produce approximately 3.8 BCF gas per day. Natural gas production has been boosted by discovery of large quantities of gas in the North Western Frontier Province in the Tal Block in Kohat, Karak and Hangu Districts. In addition to natural gas, large numbers of companies involved in exploration activity in Tal Block have also been successful in making oil discoveries.
With large quantities of natural gas available, the two public sector Companies namely Sui Northern Gas Pipelines Ltd operating in the Provinces of Punjab and NWFP and Azad Jammu & Kashmir and Sui Southern Gas Company Ltd operating in the Provinces of Sindh and Balochistan have extended their transmission and distribution networks throughout their areas of operation providing natural gas even to the remote and far flung areas.
Upto the year 2009, both the Companies have laid a total transmission and distribution network of over 100,000 kms providing gas to more than 5.5 million consumers in the Power, Fertiliser, Cement, Industry, Transport (CNG), commercial and Domestic Sectors. In the overall Energy Mix of the country, Natural Gas is meeting almost 50% requirement, whereas, the balance needs are being met though Oil, Coal, Hydel, LPG and Nuclear sources.
During the year 2008-09, natural gas consumed by various sectors is given below:

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Power          32%
Fertiliser     16%
Cement          1%
Industry       15%
Transport       7%
Commercial      3%
Domestic       17%
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USE OF GAS IN THE FERTILIZER SECTOR: Pakistan is an agro based country with 70% population living in rural areas earning livelihood through agriculture. Fertiliser is one of the main inputs in the agriculture sector and has a significant role in the productivity of crops. It is, therefore, extremely important that the fertilisers are available to the farmers on time at the affordable prices.
Since the country is gifted with large quantities of Natural Gas which is the basic raw material for production of fertiliser, therefore, a number of fertiliser, units have been established throughout the country for production of fertiliser at affordable rates. Total indigenous production of urea is 4.2 million tons per annum while that of DAP is 0.650 million tons per annum, against demand of 5.2 million tons per annum of urea and 1.4 million tons per annum of DAP.
This production is further increase with start of operation by the two new plants being set up by Engro Chemicals and Fatima Fertiliser, where after, we may be able to meet the total demand locally. The fertiliser sector is consuming 16% of the total natural gas production which will further go up after the above two plants start full operation. Indigenous natural gas has thus contributed to a substantial saving in the Pakistani import bill helping in improving balance of trade.
CEMENT SECTOR: 20 Cement Plants are connected to the natural gas system using gas for their cement productions as well as Power Generation for their Plant operation. Due to availability of cheap fuel in the form of natural gas, the cement sector has increased its production manifold by undertaking expansions and now is not only meeting the total demand but also exporting cement to others countries earning substantial foreign exchange for the country.
POWER SECTOR: While power generation through Hydel sources remains the cheapest, its generation capacity is stagnant for the last many years as no new Hydel project has come on line after Ghazi Brotha Power Project. Therefore, many power plants have been set up based on natural gas which remains the cheapest fuel when compared with other fuels such as RFO, HSD and Coal. Power Sector has remained the largest consumer of natural gas thus making available cheap electricity to the National Grid.
CNG SECTOR: Pakistan started Compressed Natural Gas (CNG) as a transport fuel program through establishment of research and demonstration CNG refuelling stations by Hydrocarbon Development Institute of Pakistan (HDIP) at Karachi in 1982 and at Islamabad in 1989. CNG is now fast emerging as the most preferred vehicular fuel in place of oil. Pakistan is the largest user of CNG in the world. Large diesel vehicles (buses and trucks) being the major consumer of HSD are now next target for substitution by CNG for economic and environmental reasons.
Most natural gas vehicles operate using compressed natural gas (CNG/methane). CNG is a cleaner alternative to other automobile fuels such as gasoline (petrol) and diesel. As of 2008 there were 9.6 million natural gas vehicles (NGV) world-wide, led by Pakistan (2.0 million), Argentina (1.7 million), and Brazil (1.6 million).
Natural gas is a key fuel to the transportation sector, and there are more than 3,000 natural gas fuelling stations in Pakistan alone. In recent years, technology has improved to allow for a proliferation of natural gas vehicles, particularly for fuel intensive vehicle fleets, such as taxicabs and public buses. Natural gas, being the cleanest burning alternative transportation fuel available today, offers an opportunity to meet environmental emissions standards.
In addition, natural gas is very safe. Being lighter than air, in the event of an accident natural gas simply dissipates into the air, instead of forming a dangerous flammable pool on the ground like other liquids fuels. Natural gas is also an economic alternative to gasoline and other transportation fuels.
In addition to being economic, many proponents of NGVs argue that a transportation sector more reliant on domestically abundant natural gas will decrease the Pakistani dependence on foreign oil - allowing for a more secure, safer energy supply for the county as well as a sharp decline in the import bill currently amounting to billions of dollars.
During the fiscal year 2008-2009; natural gas consumption by the CNG sector was 66,330 MMCF on SNGPL's system, equivalent to 2,342,159,299 liters of petrol. As it is a cheaper fuel than the gasoline, the shift of transporters and individuals has saved a huge amount of dollars from being paid in the form of oil imports. This has had positive effect on the balance of payment for the government.
INDUSTRIAL SECTOR: Industrial uses of natural gas are many, including the same uses found in residential and commercial settings - heating, cooling, and cooking. Natural gas is also used for metals preheating (particularly for iron and steel), drying and dehumidification, glass melting, food processing, fuelling industrial boilers and Power Generation.
Natural gas can also be used as a feedstock for the manufacturing of a number of chemical products. Gases such as butane, ethane, and propane may be extracted from natural gas through cracking process, to be used as a feedstock for fertilisers and pharmaceutical products.
Industrial use of natural gas in Export Oriented Industry, particularly Textile Sector in Pakistan is increasing rapidly as it is a cheap fuel and the finished products remain competitive in international market. It is a major sector employing millions of individuals and contributing towards meeting local demand and saving a large outflow of capital in form of imports hence facilitates in improving balance of trade and balance of payments for the government.
DOMESTIC USE: Natural gas is a cheap and convenient fuel for the domestic consumers. Gas is used in domestic sector mainly for cooking, water heating and space heating. It is a cheaper and environment friendly fuel and has replaced the use of old traditional usage of Wood, Coal, LPG etc which have not only been expensive but also scarcely available. Gas usage in the domestic sector has increased tremendously over the past few years with provision of new domestic connections providing cheap fuel to the domestic households.
COMMERCIAL USES: Natural gas is also playing an important role in the commercial sector providing cheaper fuel. The commercial sector includes office buildings, schools, churches, hotels, restaurants, sweet shops, barbar shops, teas stalls etc.
Natural gas is a convenient fuel without involvement of any transportation or storage facility, thus reducing extra cost to commercial sector ultimately providing less expensive products/services to the general public. In view of being a cheap and convenient fuel, the usage of natural gas in commercial sector is increasing tremendously day by day.
Sui Northern Gas Pipelines Limited (SNGPL) was incorporated as a private limited company in 1963 and converted into a public limited company in January 1964 under the Companies Act 1913, now Companies Ordinance 1984, and is listed on all the three Stock Exchanges of the Country.
The Company took over the existing Sui - Multan System (217 miles of 16 inch and 80 miles of 10 inch diameter pipelines) from Pakistan Industrial Development Corporation (PIDC) and Dhulian - Rawalpindi - Wah system (82 miles of 6 inch diameter pipeline) from Attock Oil Company Limited. The Company's commercial operations commenced by selling an average of 47 MMCFD gas in two regions viz. Multan and Rawalpindi, serving a total number of 67 consumers.
SNGPL is the largest integrated gas company serving more than 3.4 million consumers in North Central Pakistan through an extensive network in Punjab and NWFP. The Company has over 46 years of experience in operation and maintenance of high-pressure gas transmission and distribution system. It was also expended its activities to undertake the planning, designing and construction of pipelines, both for itself and other organisation.