Can our oil and gas sector keep pace with climate demands?
The writer is an Islamabad-based researcher and climate policy expert. He can be reached at khalidmayo@hotmail.com
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As nations accelerate their shift to cleaner energy, Pakistan's continued dependence on fossil fuels, accounting for over 85% of its energy mix, presents both a challenge and an opportunity. The oil and gas sector — long central to powering homes, industries and transport — must now adapt to a shifting global landscape.
Pakistan remains one of the ten most climate-vulnerable countries. The 2022 floods, which inflicted over 30 billion dollars in damages and displaced millions, were a tragic reminder of this vulnerability. Worsening air quality, volatile energy prices and increasingly frequent climate-related disasters highlight the unsustainable nature of current energy practices.
Globally, the energy sector is undergoing transformation. British Petroleum has committed to cutting oil production by 40% while investing 5 billion dollars annually in low-carbon technologies. Shell is rapidly scaling up hydrogen and electric mobility infrastructure. In Southeast Asia, Malaysia's Petronas is diversifying through climate bonds and renewable energy initiatives. These companies are not just reacting; they are redefining their role in a low-carbon economy. Pakistani firms must learn from these transitions.
Some positive developments are emerging locally. Mari Petroleum, now Mari Energies Limited, has joined the Oil and Gas Decarbonization Charter and issued its first integrated sustainability report — complete with a net-zero policy and a pilot carbon capture initiative that aims to store 1.6 million tonnes of carbon annually. OGDC and PPL have also joined the charter, indicating a shared commitment to decarbonization. PSO, meanwhile, is advancing its clean-energy journey through steps like energy-audits and renewables planning, although it has not yet signed the charter. As a next step, all these companies can demonstrate leadership and enhance credibility in the global transition.
What is needed is not just technical upgrades but a mindset shift across the sector. Energy companies must integrate sustainability into all aspects of operations - from investment planning to workforce development. This includes setting verifiable emissions reduction targets, investing in carbon capture technologies, piloting renewable energy projects and ensuring transparent environmental reporting. Equally important is building internal climate literacy so that employees, leadership and stakeholders understand the long-term implications of their actions. Collaborations with international energy companies can further facilitate the transfer of green technologies and practices suited to Pakistan's conditions.
Policy support will play a crucial role in this transition. Regulators must enforce existing environmental standards, introduce practical incentives for clean energy and mandate public disclosure of emissions. Meanwhile, solar and wind energy — despite their abundance — remain underexploited and skeptical among the masses. Reducing import duties on renewable energy equipment, encouraging local manufacturing and simplifying project approvals could significantly scale up adoption.
Thar's lignite coal reserves, while offering short-term energy relief, present a long-term environmental conundrum. Continued reliance on coal undermines Pakistan's international climate commitments. A more balanced path involves deploying cleaner coal technologies, tightening environmental oversight and concurrently expanding renewables to gradually displace coal's role in middle timeframe.
Looking ahead, the upcoming COP30 summit in Brazil offers a timely opportunity. In preparation, a national roundtable titled 'Road to COP30' brought together stakeholders, including regional ministers, policy experts and professionals. The discussion emphasized strengthening regional cooperation, aligning domestic energy goals with climate resilience and fostering inclusive policymaking. These ideas now need to be translated into actionable strategies.
Pakistan must reform outdated practices, invest in clean technologies and embrace a future where environment sustainability and economic development go hand in hand. As the world moves toward a carbon-neutral future, Pakistan must not only follow — but lead. COP30 offers a moment not just to reflect, but to act.
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