Fueling crisis: Delay in LNG import causes $2 billion loss annually

Govt plans to import 2bcfd of gas in next three years to tackle shortages.

ISLAMABAD:

Saying that gas import is a solution to the energy crisis, Petroleum Minister Shahid Khaqan Abbasi has claimed that the country is bearing an annual loss of $2 billion because of delay in import of liquefied natural gas (LNG).

“No one is ready to take a decision on LNG import projects due to courts and media,” he said.

Speaking at a seminar held by the All Pakistan CNG Association here on Monday, Abbasi said the government had planned to import two billion cubic feet of gas per day (bcfd) in the next three years to tackle the energy shortages.

He assured CNG businesses that the government would offer incentives to them to promote the fuel in the country.

“We are focusing on LNG imports, Iran-Pakistan (IP) and Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline projects to overcome the energy crisis,” he said and declared Iranian gas was cheaper than LNG.

Pointing to a report prepared by an institute that termed the IP gas pipeline a cause of economic crisis for Pakistan, he said “loyalty of such people who filed the report is questionable.”

Gas import from Turkmenistan under the TAPI pipeline would be cheaper worth $1 billion than the Iranian gas, he said. However, “Pakistan is committed to the IP gas pipeline.”

Talking about the CNG crisis, he acknowledged that CNG benefitted the country and half of the vehicles were running on this fuel.

“The only solution to the woes of CNG industry is imported gas,” he declared, saying LNG import could address energy shortages in Pakistan and the government would unveil incentives for promoting the CNG business.

All Pakistan CNG Association Chairman Ghiyas Abdullah Paracha announced that they were ready to import LNG to resolve the CNG crisis. “CNG is an alternative to 3.5 billion litres of petrol and high speed diesel,” he said.

According to Paracha, the CNG price had gone up Rs4 per kg following a hike in power tariff. However, the Oil and Gas Regulatory Authority (Ogra) refused to allow recovery of the price increase from the CNG consumers.

He pointed out that the CNG industry had invested Rs450 billion so far, but it was facing financial crisis due to “wrong policies of the past government”. He stressed that uninterrupted gas supply should be ensured to the CNG sector through LNG imports.

“CNG stations may receive gas for the entire week with the help of 400 million cubic feet of LNG per day,” Paracha said, suggesting that LNG import should be exempted from taxes to make it feasible for the consumers.

Published in The Express Tribune, November 5^th, 2013.

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