Pakistan diversifies LNG imports with first cargo from Nigeria

With fresh supply, the second LNG terminal starts functioning at Port Qasim

ISLAMABAD: Pakistan succeeded in diversifying its gas import sources as first liquefied natural gas (LNG) vessel, carrying 70,000 tons, arrived from Nigeria on Friday at the Floating Storage and Regasification Unit at Port Qasim.

Before the fresh supplies, Pakistan has been importing LNG from Qatar since March 2015. The government is also negotiating a state-to-state LNG deal with Nigeria without inviting any bids.

Global commodity trader Gunvor, headquartered in Switzerland, brought the LNG cargo from Nigeria through Golar Kevin vessel at the second LNG terminal, which was inaugurated by Prime Minister Shahid Khaqan Abbasi on November 20.



According to sources, with the arrival of the first cargo at the new terminal, acceptance tests will be undertaken immediately and after their completion, LNG supply to the national grid will rise by 600 million cubic feet per day (mmcfd) in the next few days.

Already, the first LNG terminal at Port Qasim has been handling and processing 600 mmcfd of gas.

Pakistan has achieved a milestone as higher LNG imports will ensure that gas load-shedding virtually comes to an end in the current winter.

Three LNG-based power plants with cumulative production capacity of 3,600 megawatts are being set up in Punjab, which will need uninterrupted supply of gas. They will receive the imported gas processed at the second LNG terminal.

Owing to the fast widening gap between demand and supply of energy in Pakistan, the government has been pursuing LNG imports for the past around three years.

It injects 600 mmcfd of re-gasified LNG into the system, which comes from the first terminal, and it is consumed by power, fertiliser and cement plants, general industry and compressed natural gas (CNG) filling stations.

The second LNG terminal, with the same 600mmcfd handling capacity, has been developed by Pakistan GasPort Limited with an investment of $500 million. The company has planned to build one more LNG terminal with a similar $500-million investment.

Two more LNG terminals are also planned to be built at Port Qasim which are expected to be commissioned in the second and third quarters of 2018.

The already built two LNG terminals, including the new one, will pump 1.2 billion cubic feet of LNG per day (bcfd) into the pipeline network to help the country overcome energy shortages.

After coming to power in June 2013, the government has particularly focused on gas imports to minimise power outages as domestic gas production has remained stagnant at 4 bcfd for over a decade.



During the four-and-a-half-year tenure of the current government, 500 mmcfd of domestically produced natural gas has been added to the system, but the same volume has evaporated due to depletion of the old gas reserves.

To the contrary, crude oil production has increased from 64,000 barrels per day to 100,000 barrels per day.

The government believes that the only solution to the country's energy woes is gas import which will help meet growing consumption needs and feed the expanding economy.

Published in The Express Tribune, November 25^th, 2017.

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