Friday September 29, 2023

Qatar asks Pakistan to address obstacles to Energas LNG terminal investment

May 25, 2023

ISLAMABAD: Qatar has asked the Pakistani government to address all obstacles hindering its investment in the long-delayed Energas LNG terminal, a senior official of the Energy Ministry said on Wednesday. The consortium that owns Energas LNG terminal company is seeking pipeline capacities in both the Sui Southern and Sui Northern systems from the government. While the Sui Southern Gas Company (SSGC) board has allocated pipeline capacity, the approval for pipeline capacity from the Sui Northern Gas Pipelines Limited (SNGPL) board is still pending.

The official said incomplete documentation related to the Third Party Access (TPA) associated with the Oil and Gas Regulatory Authority (OGRA) is another issue causing delays. Interim pipeline capacity has become necessary due to the incomplete OGRA TPA documents. The network code, which is crucial for operationalizing the network, remains incomplete, with no progress made towards its finalisation, the official said.

Qatar has 49 percent shares in the Energas LNG terminal that will be constructed at the cost of $140-160 million. Doha has been persistently urging the government to resolve all the issues which have emerged as stumbling blocks in the way of construction of the LNG terminal. The LNG terminal will be constructed on a private-to-private model with no government sovereign guarantee for LNG takeoff. The official said Tabeer LNG terminal, owned by Japan's Mitsubishi, is facing similar issues and wants the solution to the said issues prior to its construction. Like Energas, Tabeer LNG terminal will operate under the private-to-private model. However, the management of Tabeer terminal is also dormant over the non-solution of the issues by the government.

Qatari ambassador Saud Bin Abdul Rehman Al Thani who called on Minister of State for Petroleum Dr Musadik Malik on Tuesday took up the issue of the Energas LNG terminal and in response, the state minister assured that the government will provide the required facilitation by removing the hurdles so that the LNG Terminal could be constructed and commissioned. Earlier when Prime Minister Shehbaz Sharif visited Doha, the top functionaries in Qatar raised the issue of investment in Energas LNG terminal which is still in the pipeline for several years. However, after the PM’s visit to Qatar, there is no progress yet towards the solutions to the issues which are mandatory prior to construction of the private to private based LNG terminal.

The official said that had there been a resolution of the issues on time, the Energas and Tabeer LNG terminals would have been commissioned sometime in 2021. For the Energas LNG terminal, there is a $1.3 billion guarantee by Qatar for over 15 years. And with the installation of Energas LNG terminal, the country’s storage capacity would have increased by over 50 percent.