Reports have emerged that the Petroleum Division is proposing the construction of an LPG pipeline with the capacity of 12,000 tonnes per day from Karachi to the north of the country, with offtake points along Lahore, Rawalpindi, Bahawalpur, Multan and others. This could be a positive development for the sector as it currently lacks the requisite infrastructure to keep up with growing demand. In addition to this, the plan also includes the construction of storage at each offtake point to minimise the requirement of storage at import terminals, which is more expensive and adds to the cost of transportation.

According to reports, the Petroleum Division will soon move a summary to the ECC seeking permission for initiating this project. As things stand currently, the supply of imported LPG for Karachi and various local refineries and gas-producing fields is carried out through tank lorries which cause road congestion and pose safety threats. Additionally, the lorries also act as a barrier to increasing the supply of LPG due to their limited storage capacity.

The country’s existing import capacity allows for additional imports of only 800 tonnes per day for which fleets of over 200 hundred tankers are required for transportation. This lacking infrastructure is not allowing us to keep up with the demand, and the construction of this pipeline could help us increase our import capacity of 500,000 tonnes per year to around 4 million tonnes per year.

Not only will this pipeline help address infrastructure constraints, but also minimise storage requirements at import terminals, help reduce energy consumption and exhaust emissions, and also help make up for the domestic shortfall in the SNGPL network during peak seasons. However, before any of this is pursued, it is imperative that we first ensure that better import contracts are secured as we cannot continue to purchase at spot market rates. This is an extremely expensive and unreliable approach that cannot be continued, so this must be a prerequisite before we move on to augmenting the existing supply-chain infrastructure.