OPEC Fund and Islamic Trade Finance Corporation help secure Pakistan's winter energy supply

The OPEC Fund for International Development (OPEC Fund) and the Islamic Trade Finance Corporation (ITFC) have united efforts to ensure adequate energy supplies for Pakistan as the country braces for the coldest period of the year. Both development institutions have pledged USD 50 million each to support the importation of essential energy carriers.

Pakistan experiences chilly winters, with mean temperatures dropping to about 4°C in Punjab during January and sub-zero temperatures in the northern regions and Balochistan. The country’s mountainous terrain, including numerous peaks above 6,000 meters, presents a challenge in securing energy supplies, demanding intricate infrastructure and advanced logistics.

Despite Pakistan’s increasing investments in renewable energy sources like hydropower, solar, wind, and biomass, the nation heavily relies on imported fossil fuels such as oil, gas, and LNG. The collaborative funding initiative by OPEC Fund and ITFC aims to alleviate power shortages and ensure energy supplies during a critical phase marked by escalating energy demands due to a growing population and economy.

Since initiating its first operation in Pakistan in 1976, OPEC Fund has sanctioned over US$645 million through 33 loans in the country. Notably, the largest ongoing project is the Mohmand Dam, expected to yield 740 MW of hydroelectricity upon completion. This endeavor is anticipated to fuel economic growth while facilitating more cost-effective energy production. Pakistan’s government has prioritized the development of hydropower, aiming for a 50% reduction in emissions by 2030 as part of its national agenda.