Qatar Petroleum-led consortium commits biggest LNG regasification unit

KARACHI: A foreign investors’ consortium, led by a world’s leading oil firm Qatar Petroleum, on Tuesday announced that it would set up the Pakistan’s biggest floating storage and regasification unit (FSRU) with 750 million cubic feet per day capacity to regasify liquefied natural gas (LNG).

“The consortium will seek to develop a project that includes a FSRU, a jetty and a pipeline to shore to provide a timely and reliable natural gas supply to Pakistan,” state-owned Qatar Petroleum said in a statement. “The FSRU will have a minimum regasification capacity of 750 million cubic feet per day by 2018.”

The company said it has already committed the FSRU, “and the consortium is promptly advancing through the necessary technical and commercial milestones.   ”  The investor group includes France-based oil company Total, Japanese tech keiretsu Mitsubishi, American petroleum firm ExxonMobil and Norwegian shipping company Hoegh. The import project will be in collaboration with the Global Energy Infrastructure Limited.  The group, however, didn’t make an investment disclosure. 

Pakistan started the 3.5 million tonnes per year Engro Elengy LNG terminal, the country’s first LNG import facility, at Port Qasim in March 2015. Pakistan shipped a total of 1.02 million tonnes of LNG in 2015, and imported 1.78 million tonnes in the first seven months during the last year.

Pakistan is emerging as a global key LNG buyer, besides Egypt and Jordan, to bridge the widening deficit between gas demand and supply in the country, standing at two billion cubic feet/day. The south Asian country has a large demand for natural gas and a well-established gas market and distribution system. 

Last year, Texas-based expressed its willingness to arrange second FSRU at Port Qasim in 2018 in order to increase total LNG regasification capacity of its two units to more than one billion cubic feet/day. It said the supply would be sufficient for 6,000 megawatts of power generation – an estimated electricity shortfall in the country.  

Singapore’s BW Group also announced to deliver a FSRU under a 15-year agreement with the government.  Qatar Petroleum said natural gas is a cost-competitive fuel and can deliver significant environmental benefits. 

“This project has the potential to deliver substantial, reliable natural gas supplies to the public and private sectors in Pakistan,” it added.  Saad Sherida Al-Kaabi, president and chief executive officer of Qatar Petroleum said the consortium would bring together partners with a proven track record of industry-leading performance and a history of delivering projects on time and on budget, while focusing on environmental stewardship. They are global leaders in producing, shipping and marketing LNG with a strong track record of delivering on project execution in a very competitive global LNG market.

“Forming this consortium with Total, Mitsubishi, ExxonMobil and Hoegh represents a significant milestone that complements Pakistan’s successful effort to meet the growing demand for clean-burning natural gas in this important market,” Al-Kaabi said. “Qatar Petroleum is proud to partner with these distinguished companies to help meet Pakistan’s energy needs.”