Third LNG facility to become functional in 2023

At present, two liquefied natural gas (LNG) terminals are operating in the country to meet the ever-growing energy needs of consumers and the third facility will be functional by next year, Federal Minister for Energy Hammad Azhar has said.

In an interview with Bloomberg, the minister said that Qatar, one of the top suppliers of LNG in the global market, was also looking to invest in the establishment of an import facility in Pakistan.

“The government is looking to set up its own import facility by converting a portion of a state-owned liquefied petroleum gas terminal,” he said.

The energy minister noted that Pakistan was pursuing a strategy to open up its oil and gas sector, under its ease of doing business strategy, to accelerate the active participation of private entrepreneurs in a bid to meet the increasing demand for energy in the country.

He observed that the government was formulating legislation to ease the access of foreign supplies to users who make up about 70% of winter demand. With the current supplies, Pakistan could barely meet the demand of its current customers. “Gas is running low in Pakistan and we have to supplement it,” he said.

Domestic gas production has fallen by about a fifth over the past two years and the legislation, which would allow LNG to be supplied to local customers, is set to be presented in the upper house for approval.

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As LNG is more expensive than local gas, a detailed discussion on pricing would be needed however, the hikes would not be drastic, the minister said.

Azhar said Pakistan was also using surplus electricity as an alternative to gas in a bid to reduce its demand.

The government, which has already offered incentives to use electricity rather than gas for heating, is exploring additional ways to encourage industries to permanently move away from gas-fired generators, the minister said.

Separately, the minister maintained that the government continued to increase the transmission capacity of the country.

This week the National Transmission and Despatch Company completed and energised Rs9.4 billion Faisalabad West 500 kV Grid Station, he tweeted.

He said the initiative would resolve the issues of low voltage, overloading causing load shedding in the Faisalabad Electric Supply Company area and benefit 21,000 tube wells.