Construction of underground gas storages from August



The government has planned to construct the Strategic Underground Gas Storages (SUGS) in August this year to meet the increasing gas demand in future, which were considered mandatory along with the import of LNG as per international practices.
“Feasibility study of the SUGS is scheduled to be completed in May, while construction on these facilities will start in August 2021,” a senior official privy to petroleum sector developments told APP.
He said it was unfortunate that the previous government had introduced the Liquefied Natural Gas in Pakistan’s market without constructing any storage facility and declaring it a petroleum product, due to which it cost almost double than the locally produced gas.
In the given scenario, the official said every LNG shipment had to be consumed within four to five days, in the absence of storage facilities, for berthing of another cargo ship. “Whenever LNG terminals are installed in any part of the world where Pakistan-like gas infrastructure exists, the storage facilities must be constructed there,” he added.
The official said the construction of SUGS was part of the government’s policy to improve energy security and affordability in the country, adding “the SUGS is aimed at meeting the country’s growing domestic and commercial needs especially during peak winter months of November, December, January and February.” The underground facilities, he said, would be constructed in collaboration with the Asian Development Bank (ADB). A consortium of European oil and gas equipment companies is leading the study in that regard.
Explaining the rationale for building the SUGS, he said Pakistan had considered building emergency stockpiles of gas “to deal with supply disruption amid the country’s growing domestic and commercial demand especially in winter.”— APP

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