Free trade agreement: Pakistan ineligible for LNG deal with US

Published: March 28, 2014
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Will have to improve human rights record, law and order situation first. PHOTO: FILE

Will have to improve human rights record, law and order situation first. PHOTO: FILE

ISLAMABAD: 

In the absence of a free trade agreement with the United States, Pakistan cannot strike a liquefied natural gas (LNG) import deal with the world’s sole superpower, limiting Islamabad’s options on quenching its energy needs.

According to sources, the revelation was made during a recent meeting in Washington between US State Department officials and a Pakistani delegation led by Additional Petroleum Secretary Arshad Mirza. The delegation was told that to qualify for importing LNG from the US, Pakistan will have to improve its human rights record and law and order in the country. Only then can a country sign a free trade agreement with the US.

“Pakistan cannot import LNG from the US since it has not signed a free trade agreement with the latter… The US only signs an FTA with countries who meet certain security and human rights standards,” a source quoted American officials as saying.

Some eight countries, including India, have already secured LNG import deals with the United States. Another 25 countries are currently negotiating with US officials over LNG imports.

While, according to a delegate at the meeting, Pakistan has not yet applied for an LNG deal with the US, the Planning Commission in a January 2012 report suggested purchasing LNG from the US to lower costs and meet the country’s energy needs.

Washington has been pushing Islamabad to shelve the IP pipeline project in favour of the Turkmenistan-Afghanistan-Pakistan-India (TAPI) gas pipeline. At this stage, however, the TAPI pipeline appears a dream due to unrest in Afghanistan.

Insiders also believe that the IP project, which was at an advanced stage, has been all but shelved following $1.5 billion ‘gift’ to Pakistan from a ‘friendly’ nation, widely presumed to be Saudi Arabia.

“The only option left for the government is to pursue LNG import,” an official said.

“But the government is focusing only on importing LNG from Qatar, which has quoted a high price of over $18 per mmmbtu… a price closer to that of furnace oil,” he added. In contrast, the US Henry Hub has currently indexed the price of gas at $10 per mmbtu.

The official said Pakistan had missed the opportunity to purchase LNG on a cheaper rate from Qatar in the past. The country, he added, runs the risk of similar treatment by the US, which is projected to become the largest LNG exporter in the world.

US authorities, meanwhile, welcomed Pakistan government’s move to import LNG from Qatar during the meeting in Washington, sources said.

Published in The Express Tribune, March 28th, 2014.

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Reader Comments (12)

  • Raj - USA
    Mar 28, 2014 - 10:47AM

    “The delegation was told that to qualify for importing LNG from the US, Pakistan will have to improve its human rights record and law and order in the country. Only then can a country sign a free trade agreement with the US.”

    These are the costs Pakistan shall pay for forced and raped conversions of hindu and christian girls, shia killings and destruction of places of worship.

    Here are few recent reports form UNHCR, Immigration and Refugee Board of Canada, Human Rights Commission, UNHCR and Index on Censorship:

    http://www.refworld.org/docid/510f8b832.html

    http://www.justice.gov/eoir/vll/country/canada_coi/pakistan/PAK104258.E.pdf

    http://www.humanrights.asia/news/ahrc-news/AHRC-STM-136-2013

    http://www.indexoncensorship.org/2014/01/pakistan-not-safe-for-hindu-girls-of-marriageable-age/

    Just two years ago, Hamid Gul said on a TV talk show that two things should be done to the US. (1) Pakistan should cut off NATO supply routes and (2) Oil Kingdoms should cut off oil supplies.
    I pity his wisdom. US is a net exporter of energy today.

    As for Pakistan, IP pipeline is gone, is ineligible for LNG deal with US, TAPI is just a dream and Qatar will also refuse to supply LNG even if Pakistan is prepared to pay a high price due to Pakistan’s recent involvement in Syria.

    Recommend

  • Hari Om
    Mar 28, 2014 - 12:37PM

    The “$1.5 billion ‘gift’ to Pakistan from a ‘friendly’ nation, widely presumed to be Saudi Arabia” is likely to impact more than the Iran-Pakistan Gas pipeline deal. Just as Saudi Arabia and Iran are at loggerheads, Saudi Arabia and Qatar from whom Pakistan is looking to import LNG, are at loggerheads. Being at loggerheads with the Saudi’s and having other buyers for her LNG, it would be foolish of Pakistan to expect Qatar to be flexible on exporting her LNG to Pakistan. A client state must be careful of the choice of her patron.Recommend

  • Roshan
    Mar 28, 2014 - 12:43PM

    I wonder what and who decide Pakistan’s national interests.

    Recommend

  • Ghostrider
    Mar 28, 2014 - 12:56PM

    indeed Pak has a bad record but lets for instance reflect on US HR record…Vietnam, Cambodia, Guatanamo, Iraq, Afghanistan and rest of 20 other countries invadedRecommend

  • Mar 28, 2014 - 1:43PM

    India import of LNG from US start from September 2017 every year thereafter and for this India has formulated new policy that all the LNG import from US from 2017 onwards will be through Indian owned LNG Tanker Ships only so as to safeguard Indian companies and Indian ships and interrupted gas supplies from any measures that may arise from future diplomatic tussles not necessarily between India and US but between US and other countries like in case of US-Iran where due to US sanction on Iran nuclear program none of global insurance companies provided insurance cover to Iranian ships.Beside this the other motive is to encourage Indian shipbuilders to seize the opportunity to enter into a LNG Tanker construction business segment.
    India’s gas consumption requirement rises every year so to meet future requirement India needs additional 14 giant LNG tanker ship of which 5 are required for importing LNG from US only starting 2017.As the tender of supplying 14 giant LNG tanker ship is huge so to meet deadline of 2017 it was decided to split the ship building work i.e 6 LNG tankers ships will be built in overseas shipyards,4 will be build in Indian shipyard by Indian ship builders and the rest 4 is yet undecided.
    Cheers

    Recommend

  • Mar 28, 2014 - 3:17PM

    India import of LNG from US start from September 2017 every year thereafter and for this India has formulated new policy that all the LNG import from US from 2017 onwards will be through Indian owned LNG Tanker Ships only so as to safeguard Indian companies and Indian ships and interrupted gas supplies from any measures that may arise from future diplomatic tussles not necessarily between India and US but between US and other countries like in case of US-Iran where due to US sanction on Iran nuclear program none of global insurance companies provided insurance cover to Iranian ships.Beside this the other motive is to encourage Indian shipbuilders to seize the opportunity to enter into a LNG Tanker construction business segment.
    India’s gas consumption requirement rises every year so to meet future requirement India needs additional 14 giant LNG tanker ship of which 5 are required for importing LNG from US only starting 2017.As the tender of supplying 14 giant LNG tanker ship is huge so to meet deadline of 2017 it was decided to split the ship building work i.e 6 LNG tankers ships will be built in overseas shipyards,4 will be build in Indian shipyard by Indian ship builders and the rest 4 is yet undecided.Recommend

  • G. Din
    Mar 28, 2014 - 5:03PM

    @Ghostrider:
    “…indeed Pak has a bad record but lets for instance reflect on US HR record…”
    But US is not the one with the begging bowl around its neck and crying plaintively :”Dey daata ke naam! (Give in the name of Allah!”

    Recommend

  • Lord Jim
    Mar 28, 2014 - 5:48PM

    Such moves will push Pakistan over the edge and it will go berserk ..attacking neighbors with Atomic weapons ,ethnic cleansing of Baluchistan ,and Mohajir’s to make room for a greater Punjab and deals with Iran and Korea to name a few …Its best to give a few morsel’s to Pakistan before that stage arrives …

    Recommend

  • unbelievable
    Mar 28, 2014 - 8:30PM

    Even if Pakistan improved it’s human rights record …. what possible benefit accrues to the USA in a “free trade” agreement with Pakistan? Trade means an exchange of goods and the USA doesn’t need anymore countries beating on it’s door trying to sell clothing.

    Recommend

  • Shah
    Apr 13, 2014 - 8:13AM

    @Raj – USA:
    If I Started Talking About The ‘Exemplary Treatment’ of Minorities By Indian State and Society My Comment Would Be At Least 10 Times Longer Than Yours

    Recommend

  • Shah
    Apr 13, 2014 - 8:29AM

    @Lord Jim: I Have Pity For You.You Should Really See An Applied Psychiatrist.Go To The Internet And Search The Coal and Shale Gas Reserves In Pakistan. We Are Not At All Dependent on USA.
    Pakistan Going Berserk A Typical Indian’s Dreams LOL

    Recommend

  • Shah
    Apr 13, 2014 - 8:30AM

    @G. Din:
    USA Is The One Begging China To Buy It’s Bonds and Finance It’s Deficit.At Least Do Your Research Before Spitting Out Your Anti Pakistan Venom

    Recommend

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