By SKM
August 20, 2025
ISLAMABAD: The Jhal Magsi Gas Field in Baluchistan that has been connected to the national gas distribution system after it is allocated to SSGC (Sui Southern Gas Company Limited) will help save $298 million per annum if it is substituted with the imported gas—RLNG of which the tariff stands at $12.72 per MMbtu, a senior official of OGDCL told this scribe.
“Development activities began in February 2024, led by the Projects Department. OGDCL hired Gasco Engineering, a local engineering, procurement, fabrication, and construction firm, to provide critical support in rehabilitating 10-year-old equipment and machinery. Gasco ensured that the gas processing facilities were upgraded in line with modern safety and performance standards.”
With its supply of 14 million standard cubic feet per day of natural gas and 45 barrels per day of condensate, the recently revived Jhal Magsi Gas Field has emerged as a symbol of resilience and a milestone in Pakistan’s drive toward energy self-reliance.
The Oil and Gas Development Company Limited (OGDCL) has successfully commissioned the Jhal Magsi Gas Field in Balochistan, bringing it online after nearly a decade of dormancy. The field is now supplying 14 million standard cubic feet per day (MMSCFD) of sales-quality natural gas and 45 barrels per day (BPD) of condensate into the transmission network of Sui Southern Gas Company Limited (SSGCL), a development that marks a significant boost to Pakistan’s energy sector at a time of rising demand and costly fuel imports.
The revival of the Jhal Magsi Gas Field is seen as a model for unlocking stranded hydrocarbon resources in Pakistan. The country has more than 22 identified marginal or stranded fields with estimated reserves between 0.5 and 1 trillion cubic feet. The success at Jhal Magsi demonstrates how strong government backing, innovative pricing policies, and effective execution can revive dormant projects, reduce reliance on imported energy, and stimulate upstream investment in remote areas.
Located in the remote Jhal Magsi district of Balochistan, the gas field faced prolonged technical, security, and logistical challenges. In 2013, OGDCL initiated procurement activities and invested approximately $15.8 million in plant equipment and machinery. However, the project stalled when SSGCL was unable to construct the required 98-kilometer pipeline from Jhal Magsi to the Shori Valve Assembly. In January 2017, OGDCL declared force majeure under Rule 72 of the Pakistan Petroleum Exploration and Production Rules of 1986, effectively putting the project on hold.
Several attempts were made to allocate the Jhal Magsi gas to third parties, but the project was deemed commercially unviable under prevailing policies. On December 31, 2022, the field was certified by an independent consultant as a marginal gas field, confirming that additional capital investment was needed due to its distance from existing infrastructure.
A breakthrough came later in 2022 when Prime Minister Muhammad Shehbaz Sharif directed that the project be fast-tracked, recognizing its potential to strengthen national energy security. The Economic Coordination Committee of the Cabinet on December 15, 2022, approved a transition from the Petroleum Policy of 1997 to the Marginal Field Gas Pricing Policy, which offered incentives such as higher wellhead prices, faster cost recovery, and fiscal benefits. These measures made the project commercially viable and opened the way for renewed development.
Under the leadership of OGDCL’s incumbent Managing Director, the company accelerated work on the project.
The gas processing plant has a design capacity of 20 MMSCFD of gas and 100 BPD of condensate. It includes an inlet separator, slug catcher, amine sweetening unit, glycol dehydration system and condensate stabilization facilities.
Two wells, Jhal Magsi-1 and Jhal Magsi-2, are currently producing and naturally flowing.
A key component of the project was the construction of a 98-kilometer pipeline linking the gas field to the Shori Valve Assembly. Built from API 5L Grade B carbon steel with a design pressure of 1,000 psi, the pipeline was laid across difficult terrain with river and road crossings managed through horizontal directional drilling. The system was secured through military-supported corridors and integrated with fiber optic telemetry for SCADA operations.
The overall reactivation and pipeline development cost about $22.5 million, and the project’s payback period is less than two years. Operating expenses are estimated at between $0.52 and $0.58 per MMBTU, while the wellhead gas price is linked to 22.5 percent of the Brent benchmark under the Marginal Field Gas Pricing Policy.
Beyond energy contributions, OGDCL has carried out extensive corporate social responsibility projects in Jhal Magsi. These include the construction of 84 climate-resilient houses for local families, a grammar school for over 300 children which is in its final phase of completion, a community healthcare facility with diagnostic services, five solar-powered water purification plants, and support for cultural events such as the Jhal Magsi Desert Rally. ENDS
