Proven Success in Extractives: Pakistan’s Energy Potential and Strategic Growth

Pakistan’s extractive sector, especially its oil and gas industry, has played a significant role in the country’s economic and industrial development. From humble beginnings, this sector has evolved into a vital pillar of national growth, enabling strategic partnerships and laying the foundation for energy security and industrial expansion. The journey began with a historic milestone-the discovery of natural gas in Sui, Balochistan in 1952. This was not just a technical breakthrough, but a turning point that changed the direction of the country’s energy landscape.

The Sui gas discovery was one of the largest of its kind in South Asia at the time. It opened up new possibilities for energy self-sufficiency and industrialization. Natural gas from Sui soon powered households, factories, and power plants across the country. To this day, Sui gas remains one of the major sources of energy, contributing to around 6% of the country’s total gas production, even after seven decades of extraction. This early success laid the groundwork for the development of state-owned enterprises like the Oil and Gas Development Company Limited (OGDCL) and Pakistan Petroleum Limited (PPL), which continue to play leading roles in domestic exploration and international partnerships.
OGDCL, established in 1961, is now the country’s largest exploration and production company. It contributes over 40% to the national oil and gas output. In the 2022-2023 fiscal year alone, OGDCL produced around 32,000 barrels of crude oil per day and over 800 million cubic feet of gas daily. These figures are not just numbers—they reflect the critical role local capabilities have played in meeting the country’s growing energy demands. More importantly, these state-owned companies are not only operating within the country but also exploring international opportunities. In 2023, OGDCL entered into strategic dialogues for overseas joint ventures, which marks a new chapter in the sector’s ambition to compete on the global stage.

Another key player, Pakistan Petroleum Limited, has been central to the country’s energy development since its involvement in the Sui discovery. Over the decades, PPL expanded its footprint through exploration blocks across the country and overseas engagements. In recent years, it has actively collaborated with foreign firms and has won international tenders for exploration licenses, showing that the technical expertise developed at home is being recognized abroad.

The government has also played a proactive role in facilitating this growth. The Petroleum Policy 2012, for example, offered attractive pricing incentives and ensured a fast-track process for licensing and exploration. This policy helped attract foreign direct investment (FDI), with several global companies entering into joint ventures with local firms. As a result, the country has witnessed significant exploration activity. In 2020-2021 alone, 27 new wells were drilled, leading to multiple discoveries.

These exploration successes are not limited to traditional oil and gas. In Sindh’s Thar Desert, large reserves of coal have been tapped through public-private partnerships. The Thar coalfield, one of the largest lignite coal reserves in the world, has estimated reserves of 175 billion tons-enough to provide energy for decades. The operationalization of Thar Block-II by Sindh Engro Coal Mining Company has already started contributing thousands of megawatts to the national grid. By using local coal, the country has also reduced its dependence on expensive energy imports, which often burden the economy.
The country’s extractive industries are now shifting focus towards modernization and sustainability. Efforts are being made to reduce methane emissions, adopt green drilling technologies, and transition towards cleaner fuels. Liquefied natural gas (LNG) terminals have been established to ensure a mix of domestic and imported gas, balancing energy needs without compromising the environment. This is especially important given the global push for clean energy and sustainable development.

It is also worth noting that these achievements were made despite economic and security challenges. What makes the extractive sector stand out is the resilience and commitment shown by its workers, engineers, and planners. Across deserts, mountains, and remote areas, exploration teams have worked tirelessly to bring energy resources to the people. For instance, exploration in Khyber Pakhtunkhwa has resulted in significant discoveries in Kohat and Karak, bringing economic opportunities to previously underdeveloped regions. According to a report by the Ministry of Energy, the oil and gas sector has contributed over 2% to the GDP and has created employment for more than 50,000 people directly and indirectly.

Strategic partnerships continue to define the sector’s path forward. Local companies have entered into joint ventures with major international players such as Eni, MOL Group, and ExxonMobil. These collaborations have not only brought in capital and expertise but also exposed local talent to global standards of safety, efficiency, and innovation. The recent licensing rounds have seen strong interest from foreign firms, especially due to the untapped potential in offshore drilling. The Indus Offshore Basin, for example, is estimated to hold significant reserves that could be a game-changer in the coming decade.

The future of Pakistan’s extractive sector lies in continued investment, transparent governance, and technological innovation. Institutions such as the Directorate General of Petroleum Concessions have digitalized their systems to attract foreign investors with more clarity and less red tape. Local universities and technical institutes are now offering specialized courses in petroleum engineering and geology, ensuring a steady pipeline of skilled professionals for the sector.

In simple words, the story of Pakistan’s extractive sector is a story of proven success. From the discovery of Sui gas to modern LNG terminals and global joint ventures, the journey has shown what can be achieved with vision, planning, and collaboration. It is a reminder that national development does not only depend on imported solutions but can be driven from within by nurturing local talent and resources. The energy beneath the ground has not only fueled factories and homes, but also inspired generations of engineers and policymakers to build something that lasts. With continued focus and the right partnerships, the extractive sector will remain a key engine of growth, self-reliance, and opportunity.