Pakistan says LNG import from Qatar to continue

Petroleum minister says no reason to speculate on 15-year agreement with Qatargas

KARACHI: Pakistan swiftly moved to clear the air in the wake of the diplomatic crisis that has engulfed Arab countries, saying that its commercial deal of importing LNG from a Qatari company remains unaffected.

Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi said Pakistan will continue to import the fuel from Qatargas to meet its energy requirement, as it seeks to end load-shedding in the country.



The statement comes at the heels of the development that saw a number of Arab countries including Saudi Arabia and Egypt severing diplomatic ties with Qatar, accusing it of destabilising the region.

The sudden move prompted speculators to link the cut-off to Pakistan, which enjoys good ties with Saudi Arabia.

Abbasi, however, said that the agreement stands and Pakistan will continue to import LNG.

“It is a commercial contract. Pakistan would continue to import LNG from Qatar,” Abbasi told The Express Tribune.

The agreement, signed in February 2016, will enable Pakistan to import at least 35 million tons of LNG in 15 years at the rate of 13.35% of Brent crude oil.

The fuel is a lifeline for Pakistan, as it is partially meeting the power deficit worsened by almost stagnant gas production over the years.

The imported gas is being utilised mainly for power production, in the fertiliser sector, and conversion to CNG for use in vehicles.

“There are no sanctions on Qatar as far as we know ... there is no possibility of cancellation or delay in the import of LNG from Qatar to Pakistan.”

Responding to a question, Abbasi said the government would consider options if and when Qatar faces any sort of international economic sanctions from the United Nations or the US.

At present, Pakistan is importing around 600 million cubic feet per day (mmcfd) LNG from Qatargas. Imports are set to double in the next five to six months when the second LNG import terminal becomes operational in Pakistan.

Delay in LNG terminal, gas imports

Meanwhile, Abbasi said there is a four-to-six week delay in making the second LNG import terminal operational at Port Qasim, Karachi. The Pakistan LNG Terminal Limited was to become operational by June 2017.

The delay is on part of the government. “We are ready to pay the terminal charges that may be caused due to a delay in imports,” he told.



Domestic demand for gas has shot up to 7 billion cubic feet per day (bcfd) against local production of 4bcfd. Local production has remained stagnant for the last 15 years. “The country would do away with the deficit gas production by importing 3bcfd by December 2018.”

Published in The Express Tribune, June 8^th, 2017.

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