Is Pakistan sitting on an oil jackpot? Here's what US surveys suggest

Business Standard

4 days ago

US President Donald Trump announced a new energy initiative with Pakistan to explore and develop the country's "oil reserves", claiming they were 'massive' and suggesting that Islamabad might one day export oil to India.
'We have just concluded a deal with Pakistan … We are in the process of choosing the oil company that will lead this partnership. Who knows, maybe they'll be selling oil to India some day!' Donald Trump wrote in a post on Truth Social.
The surprise remark came amid escalating trade tensions with New Delhi and a broader White House campaign to rebalance US trade relationships, including 25 per cent tariffs and added penalties on Indian imports. Trump has expressed dissatisfaction over India's ties with Russia, specifically pressuring New Delhi on its crude oil imports.
As of now, neither the US State Department nor Pakistan's Ministry of Energy has confirmed further details.
But what does Pakistan actually have underground? The answer lies in two major US government studies — one in 2015 by the Energy Information Administration (EIA) and another in 2017 by the US Geological Survey (USGS). Both offer technically rich yet cautious estimates about Pakistan's hydrocarbon potential.
What the US said in 2015: Potential in the billions, on paper
According to the 2015 EIA/ARI study on technically recoverable shale resources, Pakistan holds:
9.1 billion barrels of technically recoverable shale oil
105 trillion cubic feet (Tcf) of technically recoverable shale gas
These are found primarily in two formations:
1. Sembar Shale (Lower Cretaceous):
Oil: 5.8 billion barrels
Gas: 101 Tcf
2. Ranikot Formation (Paleocene):
Oil: 3.3 billion barrels
Gas: 4 Tcf
The figures are impressive, but the EIA stressed that these were risked, technically recoverable resources, not proven reserves. The data were based on limited field information, modelled from US analogues, and subject to significant geological and infrastructural uncertainties.
What the USGS said in 2017: Smaller, still unproven, but quantified
In 2017, the USGS conducted its own assessment of the Lower Indus Basin — the same area where Trump's proposed development would likely occur.
According to the USGS Fact Sheet (2017-3034), estimated mean technically recoverable resources:
Oil: 164 million barrels
Gas: 24.6 Tcf
Natural Gas Liquids: 601 million barrels
This is substantially lower than the EIA's 2015 figures, suggesting that later geological modelling, while still positive, reflects a more conservative view of what's likely to be commercially extractable in the near term.
The USGS based its projections on:
Six defined assessment units (AUs) in the Lower Indus Basin
US shale analogues for productivity benchmarks
Post-Eocene geological modelling after plate collision with Eurasia
It must be noted that this 2017 assessment still assumes continuous accumulations, not proven reserves, and the probability of actual success was less than 1.0 in several units.
Pakistan's ground reality: Exploration yet to begin
Despite over a decade of mapping and studies, Pakistan has not drilled a single shale-specific well in these formations. Both reports acknowledged:
No domestic infrastructure for commercial-scale hydraulic fracturing
Water scarcity in potential exploration zones
Policy ambiguity, security risks, and lack of field data as barriers
Why Donald Trump's timing matters
Donald Trump's announcement of an oil development deal with Pakistan came just hours after imposing 25 per cent tariffs and penalties on Indian imports—timing that strongly suggests a strategic use of India–Pakistan rivalry to apply pressure on New Delhi.
The move follows a pattern in Trump's diplomacy: leveraging regional tensions to gain a negotiating advantage.
In the Russia-Ukraine war, Trump initially suspended US military aid to Ukraine, had a public spat with President Volodymyr Zelenskyy, and held talks with Russia that excluded Kyiv. Weeks later, he reversed course—publicly pressuring Moscow with a 10-day ceasefire deadline and threats of new US sanctions and openly expressing frustration with Vladimir Putin.
Even during trade tension with China in his previous term (2019), Trump showed support for Taiwan through arms sales and diplomatic visits.
While no formal project or operator has yet been named, Trump said the US was 'in the process of choosing the oil company that will lead this partnership.'
The bottom line
Trump's potential energy deal with Pakistan currently rests on highly speculative ground. The geological promise of Pakistan's shale reserves remains real but untested, and commercial extraction is years, if not decades, away without major investment, infrastructure, and political will.