Oil and gas output missed FY26 targets, annual plan shows

ISLAMABAD: Pakistan fell short of its oil and gas production goals in fiscal year 2025-26, even as output of liquefied petroleum gas (LPG) and coal exceeded official targets, according to the Annual Plan 2026-27.

The plan shows indigenous crude oil production reached 23.85 million barrels, compared with a target of 25.18 million barrels, or about 95% of the goal. Natural gas production came in at 1.07 trillion cubic feet (tcf), below the 1.16 tcf target, with the document linking the shortfall to the continuing depletion of mature gas fields.

By contrast, local LPG production rose to 0.767 million tonnes against a target of 0.567 million tonnes, while indigenous coal production reached 21.147 million tonnes, surpassing the 20.47 million-tonne target and amounting to 103% of the estimate.

Imports and drilling activity

Pakistan had planned to import 6.5 million tonnes of liquefied natural gas (LNG) in FY26, but the estimate for procurement by June 2026 was 5.26 million tonnes. The Annual Plan said the lower figure was due to the Middle East conflict. LPG imports, meanwhile, climbed to 1.5 million tonnes, above the target of 1.05 million tonnes, to help meet domestic demand.

Exploration and drilling activity also remained well below target during the year. A total of 36 wells were drilled, including 12 exploratory wells and 24 development wells, against a target of 87 wells. Despite the slower pace of drilling, the plan recorded 17 hydrocarbon discoveries, made up of one oil discovery and 16 gas or condensate discoveries. It also said 16 prospecting licences were issued to exploration and production companies.

Consumer additions and investment

On the gas distribution side, Sui Northern Gas Pipelines Limited and Sui Southern Gas Company Limited together added 383,220 new consumers, short of the target of 429,220. However, both companies achieved the objective of laying 3,707 kilometres of transmission and distribution pipelines.

The Petroleum Division carried out one ongoing Public Sector Development Programme-funded project during the year: the expansion and up-gradation of Pakistan Petroleum Corehouse (PETCORE). The project was allocated Rs245 million for sustainable operations aimed at supporting oil and gas exploration research.

The Annual Plan said the private sector remained a major source of investment in the fuel sector. Exploration and production companies invested Rs446,082 million during the year, while the LPG sector invested Rs100 million.

Targets for FY27

For FY 2026-27, the government has set higher targets for key parts of the fuel sector as it seeks to strengthen domestic energy production, cut reliance on imports and improve the resilience of energy infrastructure.

The new targets include crude oil production of 25.38 million barrels, natural gas production of 1.29 tcf, LPG production of 0.75 million tonnes and coal production of 24.53 million tonnes. The plan also envisages LNG imports of 5.56 million tonnes and LPG imports of 1.55 million tonnes to meet national fuel requirements.

In distribution, the government is aiming to add 609,740 new gas connections through SNGPL and SSGCL and lay 2,560 kilometres of additional pipeline infrastructure. The Annual Plan also said strategic initiatives, including the TAPI Gas Pipeline Project, were being advanced to improve long-term energy security and storage capacity.

It further said Public Sector Development Programme projects have been proposed for FY27 to improve geological data, encourage exploration activity and help unlock hydrocarbon potential in frontier regions.