State-owned Pakistan LNG has canceled a tender to buy liquefied natural gas over a 10-year period and may turn to the spot market instead, according to a report by Reuters.
The report stated that the company issued the tender in early June to import 240 LNG cargoes of 140,000 cubic meters each for delivery over 10 years via the second LNG terminal.
But it has decided to cancel the tender due to inadequate demand for the super-chilled fuel, one of the sources said.
(The company) has decided not to proceed with technical evaluation and opening of commercial offers as there is no demand against this tender. So for now, (the company) has decided to stop the process of long-term commitment until it receives long-term demand for LNG.
Pakistan is expected to be a significant growth driver in global LNG demand with the cabinet recently approving five consortiums to go ahead with their LNG terminal plans, said the report.
Pakistan LNG’s canceled tender was being keenly watched in the industry. The company was expected to publish the lowest prices offered by bidders, providing valuable insight into the opaque LNG market, which is characterized by closed bilateral trades, private long-term supply agreements, and an over-the-counter spot market.
Italy’s Eni, China’s PetroChina, Azeri state oil company SOCAR and commodities trader Trafigura had placed offers for the tender, sources told Reuters.