NEW DELHI : President Donald Trump's announcement of a deal to develop Pakistan's "massive oil reserves" sounds more like a strategic manoeuvre on the South Asian chessboard to counter Islamabad's growing dependence on Beijing and pressure India over the trade deal, rather than a realistic assessment of the country's immediate hydrocarbons potential.
Various estimates peg Pakistan’s 'proven' reserves of conventional oil at 0.2 billion barrels and natural gas at 529.5 billion cubic meters. These appear modest even when compared to India, which, at last count, was estimated to have oil reserves of about 4.8 billion barrels and natural gas reserves of 1149 billion cubic meters.
Pakistan's domestic production, meeting 15-18% of oil and about 60% of gas demand, also has remained modest as exploration efforts yielded incremental discoveries.
Claims by leaders in recent times have given rise to speculations over "mother-of-all" oil and gas deposits in Sindh and Karachi offshore. All these claims, however, remain unverified in the absence of commercial drilling activities, even as US major Exxon and ENI of Italy have ended surveys.
In case deposits are found to be commercially viable, they will take $5-10 billion and 5-7 years to develop. Given the location of the possible deposits, especially in strife-torn Balochistan and areas bordering Iran, it is doubtful whether US companies will be willing to invest such large risk capital in an economy in economic disarray.
Trump may be betting on a 2015 US Energy Information Agency study estimating a potential of 9.1 billion barrels of "technically recoverable" shale oil and 105 trillion cubic feet of shale gas. This is one area where US shale companies and wildcatters may get interested. But then, technically recoverable is not proven or commercially viable. That leaves many imponderables for explorers.
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