LNG terminal welcomes first vessel

Container with 130,000 cubic metres comes after spot contract was awarded to Trafigura

KARACHI: After weeks of waiting, finally a liquefied natural gas (LNG) vessel berthed alongside Engro Elengy Terminal’s floating storage and regasification unit (FSRU), marking import of the super-chilled gas.

The vessel, with approximately 130,000 cubic metres of LNG and enough to last eight days at current regasification rate of 325 million cubic feet per day (MMCFD), comes after a spot contract was awarded to commodities giant Trafigura last month.

Since the LNG import terminal was inaugurated in March, Elengy’s FSRU has been making sorties to Qatar for bringing gas.

While the FSRU could be used as a carrier, this sort of transportation was never part of the original plan, which envisaged imports through separate ships.

Pakistan has struggled to implement a long term LNG supply deal with Doha over technical glitches which involve its own organisations like Port Qasim where the terminal is located.

“The good thing is that this marks the start of continuous supplies,” said Elengy CEO Sheikh Imranul Haque. “There is also another side to this development. The trust and response of LNG suppliers to this project has been overwhelming.”

In view of the delay in start of regular imports from Qatar, Pakistan State Oil (PSO) floated a tender in May bids from overseas suppliers. Nine large trading houses including Vitol, Glencore, Trafigura, Gunvor and Marubeni participated in the bidding process. PSO subsequently awarded contracts to Trafigura and Gunvor for six consignments to be delivered up till October 2015.

Remaining shipments will be arranged by Gunvor and the terminal has received seven cargos up till now.

About government-to-government contract with Qatar, Haque said all issues will be sorted out in the coming weeks. Elengy is operator of the terminal whereas the government has designated PSO to arrange LNG shipments.

The FSRU is a large ship with onboard storage tanks and processing plant to convert super-chilled liquid methane back into gaseous form. It remains stationary and processes LNG while vessels bring in new shipments every few days.

It has been hired by Engro’s subsidiary, Elengy, which runs the LNG terminal and collects tolling tariff on gas that goes into national pipeline system.

Published in The Express Tribune, July 18^th,  2015.

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