Pakistan LNG Limited (PLL) has allowed private sector companies to import liquified natural gas (LNG) in November, reported a national daily.
The state-owned company asked the private sector to fulfill its underutilized capacity, with the forecast that LNG rates in November will be $27.75 per metric million British thermal units (MMBtu).
However, private sector oil companies are wary of PLL’s decision, arguing that LNG prices are at a record seasonal high and that a month is not enough to fulfill PLL’s underutilized capacity.
PLL confirmed that it would publish an advertisement in several newspapers today. Since the PGPL (Pakistan Port Gas Limited) LNG terminal is expected to receive only four cargoes in November, PLL will ask private sector companies to arrange one extra cargo.
Energy Ministry officials said that this would allow private sector companies to import LNG at a lower cost than PLL because private companies will be able to bypass Public Procurement Regulatory Authority (PPRA) rules.
These rules apply to PLL and ultimately result in LNG trading companies submitting higher than average bids. However, if the private sector imports LNG, companies will be able to avoid PPRA regulations and receive lower bids.
The state-run company will allow private oil companies to import LNG at just 10 percent security of the cost of cargo, as compared to the usual 100 percent security.
On average, PLL imports 5 to 6 cargoes to the PGPCL terminal. However, in November, it will import three LNG cargoes and one PSO cargo from Qatar, which will be delivered on 7-8 November.
Among PLL’s three cargoes in November, one spot cargo is to be delivered by refining company TotalEnergies on 14-15 November. The other two will be delivered by Gunvor on 19-20 November and the other by ENI on 25-26 November.