Minister of State for Petroleum Musadik Malik has warned of a gas shortfall in the upcoming winter season despite procurement of additional LNG cargoes compared to the previous year.
While briefing the Senate Standing Committee on Petroleum here on Monday, the Minister remarked that ten LNG cargoes have been arranged for January and February each, two more compared to the same months of previous years. One additional cargo will arrive in January and the other in February, providing 100 million cfd additional gas, apprised Malik.
However, he also stated that government would do gas rationing in winter despite purchasing additional LNG cargoes.
Malik also apprised the committee of the government’s negotiations with central Asian states, including Turkmenistan, Kazakhstan, and Uzbekistan for LNG purchases. He also highlighted that if any agreement is reached in this regard, it would provide a reliable solution for the Pakistan energy sector’s miseries.
The minister remarked that in the wake of the imminent gas crisis in winter, the government is importing additional 20,000 tons of LPG per month. The state-owned companies will be allowed to sell LPG, which will prevent price rigging, apprised Malik.
The committee was also apprised of the Qatar Investment Company’s proposed $3 billion investment in LNG terminals. Officials from the Minister of Petroleum maintained that the private sector is seeking investment in LNG terminals. The government, on its part, isn’t looking for investment in these terminals, the officials apprised.
Chairman committee Senator Abdul Qadir highlighted that the government should stop providing LNG at economic rates, as the circular debt of the gas sector is touching Rs. 1,574 billion. He also stated that fertilizers and industrial sectors are capable of providing actual prices for LNG.
The chairman committee asked the authorities for the spot-purchase of LNG, to which Musadik Malik responded that spot-buying companies Gunur and ENE have already defaulted, leaving no room for Pakistan to spot-purchase LNG.
Senator Saifullah Abro, while expressing reservations over capacity payments to independent power producers (IPPs), remarked that Rs. 27 billion in capacity payments were made to IPPs in the last three years. He also feared that Qatar Investment Company would also become a new IPP.
Responding to Senator Abro’s query regarding the early purchase of LNG, Chief Executive Officer Pakistan LNG Ltd. Masood Nabi stated that LNG is bought once final demand figures are available with the authorities.
