PM likely to inaugurate second LNG terminal on November 20

Facility, built without any bank loans, will provide processed LNG to Punjab power plants

ISLAMABAD: Prime Minister Shahid Khaqan Abbasi is expected to inaugurate the second liquefied natural gas (LNG) processing terminal at Port Qasim on November 20 - a significant development that will increase Pakistan’s imported gas handling capacity.

With the start of the second terminal, the country’s LNG imports will jump to 1.2 billion cubic feet per day (bcfd).

First LNG terminal, which began operations at the end of March 2015, is already handling and processing 600 million cubic feet of gas per day (mmcfd).



Pakistan produces 4 bcfd of natural gas, far short of its consumption demand for over 6 bcfd. “The second terminal will supply 600 mmcfd to 3,600-megawatt LNG-based power plants in Punjab which will help overcome energy shortages,” a senior government official said.

This terminal, set up by the Associated Group, has been completed without acquiring any bank loan. The group has planned to build another LNG terminal and has sought required approvals in this regard. Separately, Engro Corporation, which is running the first LNG terminal, also plans to set up one more terminal in partnership with the Fatima Group.

A consortium comprising Qatargas, France’s Total and Japan’s Mitsubishi is also working on building an LNG terminal. These projects will turn Pakistan into a prominent consumer on the world’s LNG map. They will also prove to be a win-win situation for both private investors and consumers of gas. The government plans to provide all locally produced natural gas to domestic consumers whereas industries, commercial consumers and new housing societies will receive imported gas.

At present, LNG is being supplied to compressed natural gas (CNG) filling stations, fertiliser plants and industrial consumers. “Gas imports have helped revive industries like fertiliser plants and CNG outlets, which had earlier no alternative fuel available,” the official said.

For building the second LNG terminal, the government had floated a tender, which was won by Pakistan GasPort Limited, a subsidiary of the Associated Group.



The BW Group, global provider of floating production services to the oil and gas industry, is also willing to pour $300 million into Pakistan for 25 years.

The government has been striving for the past four years to end power load-shedding in the country and the new LNG terminal will play a significant role as it will be supplying gas to the new LNG-based power plants in Punjab.

The first terminal is running at 100% capacity to handle 4.5 million tons of LNG per annum and the second terminal will also have the same 4.5-million-ton handling capacity.

The government has framed a policy to encourage private sector to set up LNG terminals. It also desires to replace furnace oil in power production with imported gas by 2020 for having cheaper and clean energy.

Published in The Express Tribune, November 7^th, 2017.

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