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Unformatted text preview: products. PSO has a supply contract to purchase the totality
of the Bosicor refinery's products for the next 10 years.
Another major planned project is the "Iran-Pak" refinery, which would have a capacity of
130,000 bbl/d. The refinery will be located near the border with Iran in Baluchistan province
and would be a 50:50 partnership between Pakistan's Petroleum Refining and
Petrochemical Corporation (PERAC) and the National Iranian Oil Company (NIOC). Oil
processed at the Iran-Pak refinery would come almost exclusively by sea from Iran, and
would be unloaded at a terminal to be built for the refinery. The project has failed to reach
financial closure, however, as NIOC's demand for a guaranteed rate of return is at odds with
Pakistan's policy against such guarantees. 123 Nuclear Energy
A small (125 MWe) PHWR plant was
commissioned in 1971. Known as Kanupp
(Karachi Nuclear Power Plant), this facility
makes a minor contribution (less than 1%)
to the national electricity supply. In addition,
a second plant (Chasnupp 1), a 300 MWe
PWR, has been constructed at Chasma; it
was connected to the grid in June 2000. Plans are reported for a second unit at Chasma, to
be operational in about 2009: negotiations with China on its construction were under way in
The Karachi facility, which was built in 1965 with Canadian assistance, has demonstrated a
poor operating record, which--in addition to concerns in the international community about
Pakistan's possible use of nuclear material for weapons--has contributed to the lack of
further development of the country's nuclear power sector. The Chashma Nuclear Power
Plant was built with Chinese assistance and inaugurated in 2001. Pakistan is placing more
emphasis on nuclear power to meet future energy needs and has begun talks with China
over the development of a second facility at Chashma.
Pakistan has 26.8 trillion cubic feet (Tcf) of proven gas reserves, and currently produces
around 0.8 Tcf of natural gas per year, all of which is consumed domestically. Natural gas
producers include Pakistani state-owned companies Pakistan Petroleum Ltd. (PPL) and Oil
and Gas Development Corporation (OGDCL), as well as BP, Eni, OMV, and BHP. As part of
its energy sector reform program, the government is committed to privatizing a 15% stake of
PPL (see above), the largest gas producer in the country, capable of producing 770 million
cubic feet per day (Mmcfd). The largest currently productive fields are Sui, by far the largest
at 650 Mmcfd, Adhi and Kandkhot (120 Mmcfd), Mari, and Kandanwari.
Pakistan's demand for natural gas is expected to rise substantially in the next few
years, with an increase of roughly 50% by 2006, according to Pakistan's oil and
gas ministry. Pakistan also plans to make gas the "fuel of choice" for future
electric power generation projects, hoping to substitute domestic gas supplies for
imported foreign oil. This will necessitate a sharp rise in production of natural gas,
and also has generated interest in Pakistan in pipelines to facilitate imports f...
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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.
- Spring '10