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Qatar approves delivery of first vessel in November
In a major development, the Qatar government has shown its satisfaction over the readiness of Pakistan to import liquefied natural gas (LNG) and to this effect it has given approval to deliver first vessel at Port Qasim in November 2014, official sources said.
With constrained demand of eight billion cubic feet of gas per day (bcfd) and production of 3.8bcfd, Pakistan is experiencing the worst-ever gas crisis and is left with no other option but to import LNG.
The Qatar government is to formally send next week the first draft comprising heads of agreement to Pakistan and then the authorities concerned and experts of Pakistan will deliberate the heads of agreement and start the formal technical dialogue with the Qatar Gas Company, the officials said.
This development came when a delegation of Qatar Gas Company comprising Abdullah Ahmad Al Hussaini and Hamad Abdul Aziz Al-Mahanadi held preliminary talks with senior officials of the Ministry of Petroleum and Natural Resources, Inter-State Gas Company (ISGC), Sui Southern Gas Company and Pakistan State Oil on Thursday, a senior official who was part of the talks told The News.
The heads of agreement, the official said, mainly include the specification of the LNG and its measurement and mode of take and pay. Once the heads of agreement gets settled then the agreement on the LNG price will be signed after negotiations, the official said.
At present, the spot buying of LNG hovers around $17 to $18MMBTU, the official said, adding that but at which price the government of Pakistan wants to import LNG from Qatar under government-to-government arrangement is to be decided at the highest level.
On behalf of Pakistan, Pakistan State Oil will initiate the dialogue with the Qatari authorities and to this effect it is to hire one the best legal firm from international market and experts from open market. Moreover, the experts of SSGC, Inter-State Gas Company and officials concerned of the ministry will also assist PSO for dialogue on LNG supply agreement with Qatar, the official said.
The official also said that in Thursday’s meeting, functionaries of Qatari Gas Company informed that it has completed due diligence of Pakistan State Oil and is satisfied with the financial health of the company, which imports crude oil of $10-12 billion per annum.
The Qatari side also expressed satisfaction with the financial health of Elengy Terminal Pakistan Limited (ETPL), a wholly-owned subsidiary of Engro Corporation, which will provide the terminal services and re-gasify LNG.
The official said the Qatari side asks the Engro Corporation to ensure safety standards as per the international standards at the terminal and the ability to handle LNG.
Pakistan State Oil will procure LNG that will be re-gasified in the terminal and would be injected in the system. Primarily, LNG of 200MMCFD gas will be imported in November 2014 and by 2015, the volume of LNG will be increased by up to 400MMCFD gas.
“We have indicated to the Qatari officials that Pakistan is interested to import two billion cubic feet gas per day in the next two-and-a-half years.”
To a question, the official said by next Tuesday, Sui Sothern Gas Company and EVTL (Engro Vopak Terminal Limited) will finalise the LNG services agreement and after that the government will also expedite the process to import LNG through the project of retrofitting of terminal, which has hit several snags so far because of Public Procurement Regulatory Authority (PPRA) objections.
The Qatari government is right now exporting 70 percent LNG of its production to Japan, China and India and is willing to export even LNG of two billion cubic feet gas per day to Pakistan in the years to come and 200MMCFD from November this year.
Source: The News Pakistan
With constrained demand of eight billion cubic feet of gas per day (bcfd) and production of 3.8bcfd, Pakistan is experiencing the worst-ever gas crisis and is left with no other option but to import LNG.
The Qatar government is to formally send next week the first draft comprising heads of agreement to Pakistan and then the authorities concerned and experts of Pakistan will deliberate the heads of agreement and start the formal technical dialogue with the Qatar Gas Company, the officials said.
This development came when a delegation of Qatar Gas Company comprising Abdullah Ahmad Al Hussaini and Hamad Abdul Aziz Al-Mahanadi held preliminary talks with senior officials of the Ministry of Petroleum and Natural Resources, Inter-State Gas Company (ISGC), Sui Southern Gas Company and Pakistan State Oil on Thursday, a senior official who was part of the talks told The News.
The heads of agreement, the official said, mainly include the specification of the LNG and its measurement and mode of take and pay. Once the heads of agreement gets settled then the agreement on the LNG price will be signed after negotiations, the official said.
At present, the spot buying of LNG hovers around $17 to $18MMBTU, the official said, adding that but at which price the government of Pakistan wants to import LNG from Qatar under government-to-government arrangement is to be decided at the highest level.
On behalf of Pakistan, Pakistan State Oil will initiate the dialogue with the Qatari authorities and to this effect it is to hire one the best legal firm from international market and experts from open market. Moreover, the experts of SSGC, Inter-State Gas Company and officials concerned of the ministry will also assist PSO for dialogue on LNG supply agreement with Qatar, the official said.
The official also said that in Thursday’s meeting, functionaries of Qatari Gas Company informed that it has completed due diligence of Pakistan State Oil and is satisfied with the financial health of the company, which imports crude oil of $10-12 billion per annum.
The Qatari side also expressed satisfaction with the financial health of Elengy Terminal Pakistan Limited (ETPL), a wholly-owned subsidiary of Engro Corporation, which will provide the terminal services and re-gasify LNG.
The official said the Qatari side asks the Engro Corporation to ensure safety standards as per the international standards at the terminal and the ability to handle LNG.
Pakistan State Oil will procure LNG that will be re-gasified in the terminal and would be injected in the system. Primarily, LNG of 200MMCFD gas will be imported in November 2014 and by 2015, the volume of LNG will be increased by up to 400MMCFD gas.
“We have indicated to the Qatari officials that Pakistan is interested to import two billion cubic feet gas per day in the next two-and-a-half years.”
To a question, the official said by next Tuesday, Sui Sothern Gas Company and EVTL (Engro Vopak Terminal Limited) will finalise the LNG services agreement and after that the government will also expedite the process to import LNG through the project of retrofitting of terminal, which has hit several snags so far because of Public Procurement Regulatory Authority (PPRA) objections.
The Qatari government is right now exporting 70 percent LNG of its production to Japan, China and India and is willing to export even LNG of two billion cubic feet gas per day to Pakistan in the years to come and 200MMCFD from November this year.
Source: The News Pakistan
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