Before final approval: Govt seeks consultant’s nod on terminal site

Asks Elengy Terminal to get clearance for safety reasons.

ISLAMABAD:

The government has asked Elengy Terminal Pakistan Limited (ETPL) to get its terminal site cleared from an international consultant for safety reasons before setting up facilities for handling liquefied natural gas (LNG) imports.

The request came in a meeting held on Thursday where the Ministry of Petroleum and Natural Resources told the ETPL management to approach international consultant Lloyds Register and get its opinion about the terminal site, sources say.



This would ensure safety of the population living nearby and the industry standing close to the existing terminal, the ministry said.

ETPL has won the tender invited for provision of LNG terminal services.

Earlier, the Oil and Gas Regulatory Authority (Ogra) put on hold the process of issuing an LNG terminal licence until clearance from the Ministry of Defence and the Port Qasim Authority (PQA) for use of its main channel.

According to the sources, the PQA has denied a no-objection certificate to ETPL for use of its jetties for handling LNG imports in the main channel until an international consultant gives the go-ahead.

“ETPL should get clearance from the consultant, ensuring that there will be no harm in setting up the LNG import facility at the existing terminal,” a source quoted the PQA as saying.

The PQA is of the view that it could be very dangerous and hazardous for the port, surrounding industrial installations and the population.

The LNG Policy 2011 called for meeting all international safety standards and the widening of the channel would not achieve the minimum recommended safe passage as per safety standards, it said.

It believed that any release of large quantities of gas under the prevailing wind conditions was likely to have an impact on adjacent facilities.

Sui Southern Gas Company (SSGC) and ETPL have already finalised an LNG services agreement and the SSGC board has approved it subject to the condition that Pakistan State Oil (PSO) provides a letter of comfort for payment of capacity charges.

The award of the contract is expected to pave the way for LNG imports from Qatar in a state-to-state deal. Earlier, Doha had asked Pakistan to first put in place an LNG handling facility before going for imports.

The government is stepping up efforts to bring first supplies in the current calendar year and has assigned the task to PSO because of its sound financial position.

The terminal will handle 200 million cubic feet of LNG per day (mmcfd) in the first phase and 400 mmcfd in the second phase, which will begin next year.

“ETPL will not go ahead with the project until each of the bodies issues the NOC required as per rules,” the company commented in a statement issued in response to the developments.

Ogra’s third-party auditors had visited the ETPL terminal and concluded that it was suitable to undertake activities related to LNG imports at the Port Qasim and for the grant of licence for transmission of natural gas, it said.

“ETPL has obtained all the required approvals for handling LNG imports … and the NOC from the Ministry of Defence is in process.”

ETPL pointed out that it had already responded to PQA’s objections and initialed the implementation agreement with the authority in March this year.

The company has conducted a quantitative risk assessment study covering the proposed site. The hazards of operability study was conducted in London in January this year, which was attended by SSGC, PQA, QatarGas and others and was led by Lloyd’s Register.

“The project meets all international safety requirements and none of the identified hazards is thought to pose a level of risk that is higher from typical LNG marine terminal operations and can be mitigated by a detailed design and operational measures,” it said.

Published in The Express Tribune, April 4^th, 2014.

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