Today, Pakistan has imported its lowest-priced liquefied natural gas (LNG) cargo.
According to the details, Pakistan LNG has imported its cheapest LNG cargo through The State Oil Company of Azerbaijan Republic (SOCAR).
Today, August 28, marks the milestone of lowest priced #LNG cargo imported in #Pakistan by PLL through @SOCARofficial of Azerbaijan
PLL contributes to Pakistan's economy by bringing #clean and affordable gas to its #energy mix. https://t.co/NAHNmCQQYV pic.twitter.com/kQo3QpxZdh
— Pakistan LNG (@PAK_LNG) August 28, 2020
Back in July, SOCAR was the lowest bidder, which quoted a remarkable rate of 5.7395% of Brent (approx. USD 2.2/mmbtu) for the cargo. Prices quoted by the other three bidders were Gunvor 7.8421%, PetroChina 8.3500%, Trafigura 10.3811%.
PLL had received an offer for an Aug 27-28 delivery cargo at about $2.20/mmbtu. It is worth mentioning that Pakistan was out of the spot market in 2020, and this was their first tender since November 2019.
A.A.H Soomro, managing director at Khadim Ali Shah Bukhari Securities told ProPakistani,
Pakistan is heading towards a massive gas shortage in the absence of a new RLNG terminal, a lack of indigenous reserves, and unutilized terminal capacities. It’s of utmost importance to provide gas – and affordable one – to industries to reduce their cost of production to regionally comparable levels.
Soomro further stated that Azerbaijan is providing very competitive offers in Corona struck global economy for RLNG spot cargoes. The real game-changer is the new terminal feeding to the unconstrained demand for export and local manufacturers, he added.
It is worth mentioning that this was lower than the Asian LNG spot price LNG-AS for August. The prices were expressed in the document as a “slope” of crude oil prices, a percentage of the Brent crude price, and are typically a pointer for the opaque spot LNG market.
Physical work on two private sector LNG terminals
Two multinational companies are all set to start physical work on setting up their Liquefied Natural Gas (LNG) terminals in the next few months after the government opened up the energy sector under its ease-of-doing-business strategy, a senior official privy to petroleum sector developments told the State’s media agency.
“The government had allowed five private sector companies to establish their own LNG terminals, out of which two firms Exxon Consortium and Mitsubishi will start physical work on their projects before the end of the current year,” he added.
After setting up the terminals, the companies will import and sell the commodity on their own without any involvement of the government except regulation matters.
The official further stated,
Pakistan’s existing natural gas reservoirs were depleting fast at a rate of 9.5 percent annually, and the LNG was the only available instant remedy to bridge the increased gap between demand and supply of the country. Currently, the country’s indigenous gas production is around 3.7 Billion Cubic Feet per Day against the demand of 6 BCFD.
Currently, two LNG terminals were operating at Port Qasim Karachi and injecting around 1,200 MMCFD gas in the distribution network of Sui Northern Gas Pipelines Limited and Sui Southern Gas Company.
According to a recent report of Oil and Gas Regulatory Authority, the gap between demand and supply of gas could increase by 5,389 Million Cubic Feet per Day (MMCFD) by 2029-30.
PK Should be launch VESSEL Services Bohat Demand hai
Local Ferry Services bhi on honi chahyeh
I could have gotten it for 2.5%