The Asian Development Bank has canceled a $0.6 million grant given for the gas storage development system in Pakistan.
Sources told ProPakistani that the Energy Division from January 2022 to December 2023 failed to implement the objectives of the Technical Assistance due to which ADB canceled a $0.6 million gas storage development system in Pakistan.
The document states that the ADB had approved the knowledge and support technical assistance (TA) for Gas Storage Development Systems on 16 December 2021.
The objectives of the TA were to analyze and recommend gas storage modalities and options across Pakistan based on the safety, reliability, cost, and effect on amenities as prime considerations; propose a policy, legal, and regulatory framework to develop, operate, and maintain gas storage facilities following international best practice; and provide advisory services on a transaction model, financial structure, and development road map for the first gas storage facility in the country.
The TA was estimated to cost $600,000 which was financed on a grant basis by ADB’s Technical Assistance Special Fund ($300,000 TASF 7 and $300,000 TASF-other sources).
The TA outputs were gas storage infrastructure across Pakistan based on safety, reliability, cost, and effect on amenities as primary considerations assessed; legal, policy, and regulatory framework to build, operate, and maintain gas storage facilities developed; and transaction advisory services for an optimal project capital structure and road map for financial closure developed.
The TA outcome was gas supply chain was strengthened, and strategic reserves requirements were met.
The TA was expected to be implemented over 24 months from January 2022 to December 2023. ADB was the designated executing agency, and ADB’s Central and West Asia Department through its Energy Division in collaboration with the Ministry of Energy (Petroleum Division) was the implementing agency.
In February 2022 after TA effectiveness, the recruitment of the consulting firm that would undertake the Gas Storage Development Systems Study was initiated and was subsequently paused after the TA implementation was put on hold in March 2023.
The TA activities were put on hold in March 2023 due to Pakistan’s financial and economic challenges. The TA’s activities and targeted outputs were not deemed essential due to changes in priorities. In light of the prevailing uncertainties and challenging situations in the country, it was decided that the TA not be extended and closed on the original completion date.
As no consulting firm was engaged, no disbursement was made from the TA, the document added.
