ISLAMABAD: After failing to sell the RLNG, the state-owned Sui Northern Gas Company Limited (SNGPL) has asked the federal government to divert 11-term LNG cargoes to be imported in 11 months of 2025 from ENI — to the international market as the Power Division has refused to increase the use of RLNG for power generation even during June, July and August---the peak summer season.
The Power Division says the electricity demand is going down and it would not run the RLNG-based power plants at the optimum level for power generation because they rank at the last of the Economic Merit Order (ECO) list. The electricity generation cost of RLNG power plants is at the higher side which stands at Rs26-27 per unit.
The refusal of the power division has put the top mandarins of the petroleum division on the tightrope who are already trying to convince Qatar to defer 5 more LNG cargoes to 2026. Qatar has already deferred the 5 LNG cargoes to 2026 which were to arrive in 2025 under the flexible clause of the 15 year contract. Pakistan LNG Limited (PLL) and ENI in 2017 signed the 15-year contract under which ENI is bound to provide a LNG cargo per month at 12.14 per cent of Brent. In the first and second year, ENI was supposed to provide LNG at 11.6247 per cent of Brent.
Sui Northern wrote a letter on January 21, 2025 to Managing Director of Pakistan LNG Limited (PLL) and mentioned that matter of surplus RLNG was taken up with the Power Division and was requested to review demand of RLNG for the upwards revision during June, July and August 2025. The letter says, NPCC (National Power Control Cell) responded on January 21, 2025 saying that the demand of the power sector for June, July and August shall remain unchanged in view of the declining electricity demand. So Sui Northern requested PLL MD to take up the matter with ENI for the diversion of LNG cargoes for the remaining 11 months of 2025. The gas consumption has gone down by 150mmcf per month. It is because of that 18 LNG cargoes have become operational. The captive power plants are also going to be disconnected by January 31. They will be connected to the grid electricity under the structural benchmark of IMF loan programme of $7 billion. This will increase the number of additional LNG cargoes up to 30.
The PLL-KE LNG supply deal will end by 2025, and if not extended, the number of additional RLNG cargoes will go up by six to 36.