Cognizant of the increased gas consumption especially during the winter season, the government has decided to execute a project of establishing the Strategic Underground Gas Storages (SUGS) by allocating funds amounting to Rs40 million under the Public Sector Development Programme 2021-22.
“The construction of SUGS is part of the government’s policy to improve energy security and affordability in the country,” a senior official privy to petroleum sector developments said.
He said the development of the SUGS was aimed at meeting the country’s growing domestic and commercial needs especially during peak winter months of November, December, January and February. The underground facilities would be constructed in collaboration with the Asian Development Bank (ADB). Whereas, a consortium of European oil and gas equipment companies was leading the feasibility study.
Explaining the rationale for building the SUGS, he said Pakistan had considered building emergency stockpiles of gas “to deal with supply disruption amid the growing domestic and commercial demand especially in winter.”
Inter-State Gas Systems (Pvt) Ltd, a state-owned entity, would be the focal agency for the project.
The SUGS facilities are crucial for the country in view of the committed supplies of imported gas under the international gas agreements and fast-growing gas demand in the country to keep pace with economic progress. The project would also significantly enhance Pakistan’s capability to provide uninterrupted gas supply for sustainable economic growth.