Pakistan Calls Shale Gas Price High

Pakistan government has rejected the shale gas price of $14 per million British thermal units (mmbtu), calculated by Pakistan Petroleum Limited (PPL) and Italy’s Eni, an official told The Express Tribune.

Average consumer gas price is around $4 per mmbtu, undermining the prospects for shale gas to be brought into the system at this stage, Moin Raza Khan, Deputy Managing Director of PPL and head of its exploration operation said, reported The Express Tribune.

“One reason why the US produces shale gas in abundance is because of the economies of scale. We would have to do that to make it feasible and this can’t happen overnight,” he said.

Pakistan hasn’t been able to attract many oil industry service providers, which own production equipment like rigs. So for the time being exploration firms including PPL are focusing on tight gas, for which the government has increased the price by 40% through a separate petroleum policy, the newspaper said.

First tight gas in the country was produced by PGNiG and PPL last month.