KARACHI: A group of leading business houses has decided to build a liquefied natural gas (LNG) terminal at an estimated cost of $120 million by March 2019 for gas processing and consumption in their own power, cement, textile and car manufacturing plants.
Younus Brothers Group, Sapphire Group and sponsors of UK-based Halmore Power Generation will build Energas LNG Terminal with handling capacity of 800 million cubic feet per day (mmcfd) at Port Qasim.
“This terminal will be different from others (in Pakistan); we all business partners are buyers of the gas and no supplier is our partner (in the terminal),” the terminal’s Chief Executive Officer, Anser Ahmed Khan, told The Express Tribune.
The designed capacity of the terminal is 4.5 million tons per annum, which is equivalent to 800 mmcfd. Of this, the current requirement of the business houses stands at 2.1 million tons for their power, cement, textile and car manufacturing plants.
When their other power projects come online, the LNG demand will swell to 3 million tons per annum.
“We are negotiating with other IPPs (independent power producers) as well as industrialists for utilising our surplus capacity, while the government may also use the terminal for imports,” Khan said.
He revealed that the Port Qasim Authority had given them provisional no-objection certificate for building the terminal. However, the Oil and Gas Regulatory Authority has yet to issue required licence.
“We hope to start terminal construction by December this year,” he said, adding they may sign an engineering, procurement and construction (EPC) contract in a few days.
“We have come forward after the installation of first two LNG terminals and government’s invitation to the private sector to continue setting up new terminals,” he said.
His estimates suggest that the country would have demand for around 15 to 16 million tons of LNG per annum, including 4.5 million tons for Energas.
Khan, who returned from abroad last year, said he had been engaged in LNG trade for the past 14 to 15 years and bought and sold approximately 14 million tons.
A joint press statement from the business houses added Energas LNG Terminal was being designed to provide berth to a Floating Storage and Regasification Unit (FSRU) – a floating terminal – of 173,340 cubic metre (m3) along with an LNG carrier of 266,000 m3.
Maximum capacity of the terminal will be 800 mmcfd with a 30-inch pipeline connected to the main grid.
“Through our group’s commitment to the development of a private LNG terminal, we hope to support the government of Pakistan’s endeavours to alleviate the existing energy crisis,” Muhammad Ali Tabba of Younus Brothers Group said in the statement.
“The company’s shareholders are progressive business groups with interest in power generation, textile, chemicals and cement amongst others,” said Shahid Abdullah of the Sapphire Group.
Energas is the fourth terminal planned to be developed in Pakistan. So far, one terminal of 600mmcfd capacity, owned by Engro Corporation, has come online.
The second terminal called Pakistan LNG Terminal Limited at Port Qasim is expected to start running this year.
A Turkish company, Global Energy Infrastructure Limited (GEIL), is constructing the third terminal of 750mmcfd capacity at Port Qasim. It is scheduled to begin gas imports in the second half of 2018.
Cumulative import capacity of all the four terminals stands at around 2,800 mmcfd.
Published in The Express Tribune, September 13th, 2017.