Part3-Chp%208 Assignment for load shedding

Development of new natural gas fields with the help

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Unformatted text preview: rom neighbouring countries. Development of new natural gas fields with the help of foreign investors is proceeding, with Pakistan's government expecting recently discovered fields to add about 1 billion cubic feet per day (Bcfd) to Pakistan's natural gas production. Currently, fields in production include Sawan at about 366 Mmcfd, Bhit at about 316 Mmcfd, and Zamzama in Sindh province producing about 248 Mmcfd, but possibly able to produce 380 Mmcfd following a new gas discovery in January 2004. Pakistan's government restated its willingness to permit a natural gas pipeline linking Iran's massive reserves to Indian markets across Pakistani territory. Pakistan would earn transit fees for Iranian gas supplied to India and also would be able to purchase some gas from the pipeline when and if its own demand was sufficient. While Iran and Pakistan have shown great interest in the project, India has been reluctant to move forward as long as political and military tensions with Pakistan over Kashmir persist. The issue was due to be discussed at bilateral talks between India and Pakistan in June 2004, although negotiations are still expected to be protracted and difficult. Iran is offering India that it will cover 60% of the construction costs of the pipeline, but India remains wary of Pakistani access to its energy 124 supply. Indian officials said the plan could be considered if Pakistan can provide security guarantees for the $3 billion project. Pakistan could earn about $600 million annually in transit fees from the pipeline. Another natural gas import possibility is an eventual link with the Dolphin Project, a scheme to supply gas from Qatar's North Dome gas field to the United Arab Emirates and Oman, via a sub-sea pipeline from Oman. Even though Pakistan has signed a preliminary agreement to eventually purchase natural gas from Qatar, it remains to be seen how the initial stages of the pipeline project go before a route to Pakistan can be conclusively negotiated. Electric Power Pakistan has 18 gigawatts (GW) of electric generating capacity. Thermal plants using oil, natural gas, and coal account for about 70% of this capacity, with hydroelectricity (hydro) making up 28% and nuclear plants 2.5%. Pakistan's total power generating capacity has increased rapidly in recent years, due largely to foreign investment, leading to a partial alleviation of the power shortages Pakistan often faces in peak seasons. Rotating blackouts ("load shedding") are, however, still necessary in some areas. Transmission losses are about 30%, due to poor quality infrastructure and a significant amount of power theft. Periodic droughts affect the availability of hydropower. With much of the Pakistan's rural areas yet to receive electric power, and less than half of the population connected to the national grid, significant power demand growth is expected in the long term, though in the short term, Pakistan has some excess generation capacity. The electric power sector in Pakistan is still primarily state-owned, but a privatizat...
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This note was uploaded on 10/02/2010 for the course MBA 32343 taught by Professor Samghouri during the Spring '10 term at Karachi Institute of Economics & Technology.

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