Govt eyes hike in LNG import by 400mmcfd

ISLAMABAD: The government has decided to increase the LNG import by 400 mmcfd by December 2019 and will open its bid next week, a senior official of the Petroleum Division said.

Of the 400 mmcfd, the government had recently floated a tender for 200 mmcfd.

The government wants to secure contracts for this additional 400 mmcfd [of LNG] by end of this calendar year, and at the same time it will also take into account the future gas market prices, as the US and Australia are also going to be the next major contributor/supplier to the LNG market.

Currently, two LNG terminals are re-gasifying over 1100 mmcfd LNG, of which the power sector is getting 790 mmcfd and fertilizer industry 180 mmcfd.

The second LNG terminal has 790 mmcfd LNG handling capacity and government has dedicated capacity of 600 mmcfd.

At present, the PSO is importing 600 mmcfd LNG from Qatar. However, Pakistan LNG Limited (PLL) has short and long-term contracts of 200 mmcfd LNG imports whereas remaining 400 mmcfd LNG is being secured through spot purchases.

The government is also striving for indigenous oil and gas exploration and recently 10 blocks have been awarded, but mostly to local companies, as the foreign companies response was not encouraging.

To attract foreign companies in this sector, the government wants to hold roadshows in important countries.

Before going for road shows, the government would amend the Petroleum Policy to offer incentives for exploration blocks in high risk areas.

The government had also formed a model petroleum concession agreement.

At present, there are 34 initiatives for exploration companies to follow and the government wants to reduce it by half to facilitate to kick off exploration activities in the country.