Pakistan buys costliest ever LNG to tackle gas crisis

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The PLL has short- and long-term agreements with Gunvor and the ENI for one LNG cargo each every month, but both suppliers refused to honour their part of the agreements….reports Asian Lite News

Pakistan accepted an LNG cargo at the highest-ever price of $30.6 per Million British Thermal Units (mmbtu) from Qatar Petroleum on the grounds of averting a possible gas crisis in the upcoming winter season, Dawn reported.

The Pakistan LNG Limited (PLL) had floated emergency bids for two cargoes to be supplied in November, as the firms involved, Gunvor and ENI, had defaulted on their commitments.

The PLL has short- and long-term agreements with Gunvor and the ENI for one LNG cargo each every month, but both suppliers refused to honour their part of the agreements.

As a result, the state-owned firm had to call a tender on emergency basis for two LNG cargoes for the months of December and January, the Dawn news report said.

For the delivery in the last week of the current month, November 26-27, the lowest tender was filed by Qatar Petroleum Trading at $30.65 per mmbtu, followed by Total Energies at $30.96 and Vitol Bahrain at $31.05 per mmbtu.

Sources in the Petroleum Division said the first tender for supply on November 19-20 was scrapped as the country was facing gas shortage in December.

Therefore, the lowest bidder for the supply on November 26-27 was Qatar Petroleum at $30.65 per mmbtu, as re-gasification and supply of LNG into the system would be done in December, the sources added.

The PLL has been facing criticism for lacking proper strategies and ensuring LNG supplies when its prices were low in the international market.

At the same time the state-owned entities had restricted the private sector from importing LNG as it could challenge the monopoly enjoyed by the public sector, the report said.

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