Italy’s Eni SpA has failed to deliver February’s scheduled cargo of liquefied natural gas (LNG) to Pakistan LNG Limited and declared force majeure.
“February LNG delivery disruption is beyond the reasonable control of ENI and due to an event of force majeure. ENI does not benefit in any way from the situation,” said the company in a statement to Reuters.
The Italian LNG conglomerate has a 15-year agreement to supply Pakistan with one cargo of LNG per month but has failed to comply with its maturing obligation to send a pre-booked package for February. “All the previous disruptions in LNG delivery suffered by ENI have been caused by the LNG supplier who didn’t fulfill the agreed obligations. Also in these cases, ENI did not take advantage or benefit in any way from these defaults and applied all contractual provisions to manage such disruptions,” it explained.
Pertinently, Pakistan has struggled to obtain spot LNG cargoes due to rising global gas prices, which reached record highs last year following Russia’s invasion of Ukraine. It has been informed time and again that long-term LNG shipments to Pakistan are insufficient to meet the country’s continuously rising demand.
It bears mentioning that the fuel-strapped South Asian economy imported 9 billion cubic meters (bcm) of LNG last year, a decrease of nearly 20 percent from 11.2 bcm in 2021.
The ENI news mirrors last year’s GUNVOR betrayal which saw the Singapore-based LNG trading company refusing to deliver four LNG cargoes to Pakistan in April-June 2022. Later that year, Pakistan State Oil (PSO) won an arbitration case against the Singaporean conglomerate. PSO was awarded over $14.6 million, in addition to other costs on October 8. The case was initiated by Gunvor in 2020.