In a new development, Pakistan LNG Limited (PLL), a government-owned corporation, has invited the private sector to import LNG for December, January, and February at high spot prices utilising its underutilised re-gasification capacity in the range of 240-385, indicating the country’s impending gas shortage.
This is the second time the private sector has been requested to import LNG. The PLL solicited bids from private parties to import LNG for the month of November 2021 earlier in September 2021, but the private sector declined due to a massive surge in LNG prices on the worldwide market.
The government is under a lot of pressure as a result of two LNG trading businesses, ENI and GUNVOR, pulling out of the PLL’s offer for eight LNG spot cargoes, four each for December and January, and receiving no response from the suppliers. The administration has now scheduled ten shipments for December and the same amount for January, but this is insufficient to meet the country’s energy demands.
The local gas production has climbed down to just 2.8 bcfd and the government will not be able to import of 1.2 bcfd in December and January against the country’s total demand during the peak winter months which has swelled to 5.5 bcfd.
Now the PLL again offered the private sector to use its utilized capacity at a time when the massive price rally of LNG is under way in the international market. The private sector is of the view that such offers should have been extended by the PLL some 3-4 months before.
The PLL says it has unutilized capacity of 385 mmcfd in the month of December, 240 mmcfd in January and 375 in February which is why under the direction of the federal government, it has invited private parties to import LNG into the country, keeping in view the eligibility criteria and OGRA determined charges for the relevant month.
“As of today, the LNG spot price has somewhat tumbled to $28 per MMBTU which is also still at higher side and how can private sector import referring to the no response from the LNG suppliers the PLL got in response to its earlier tender seeking eight LNG cargoes for December and January,” private sector sources told The News.