LNG import helps 20 percent reduction in power deficit

LAHORE: Import of liquefied natural gas (LNG) helped the government cut power deficit by around 20 percent, while it also meets 25 percent of gas needs, said a senior official. 

“RLNG availability has been critical,” the official added. “This source of energy is relatively cheap. New pipelines are being added to ensure smooth supply of imported RLNG from south up to north.”

Present Pakistan Muslim League (Nawaz) government, soon after assuming power, initiated a process of building the country’s first LNG import terminal that successive governments could not set up due to one reason or another. 

Shahid Khaqan Abbasi, the then petroleum minister led the process of setting up of 400 million cubic feet per day (mmcfd) Engro Elengy LNG re-gasification terminal in a record short period. 

Though the floating storage re-gasification unit has the lowest re-gasification rate compared to other terminals in the world, yet the new initiative helped a lot in provision of natural gas to power sector and industry.

The momentum of this intervention is, however, needed to be maintained with establishment of more such terminals.  Works on additional LNG terminals at Port Qasim (600mmcfd), Gwadar (400-600mmcfd) and Port Qasim (400-600mmcfd) are on various stages of completion.

An official report said Pakistan, which is heavily dependent on natural gas to meet energy needs, started facing shortage of natural gas since 2007. Later, RLNG has emerged as the most cost-effective fuel for power generation due to its greater efficiency, lower maintenance and no storage cost, ease of transportation, no pilferage or adulteration and minimal environmental impact.

RLNG of 400mmcfd can run as many as nine power plants with 2,000 megawatts production capacity. 

Additional annual generation of nine billion kilowatt hours was made possible due to LNG, which is equivalent to 10 percent of total current annual power generation.  Abdul Basit, president of Lahore Chamber of Commerce and Industry (LCCI) said the industry received much-needed energy to produce fertiliser, power and compressed natural gas following the launch of LNG terminal. 

Basit said textile industry also got a boost from RLNG. Perception of foreign investors about Pakistan has been changed and textile sector now started getting orders as their buyers are confident that their textile partners in Pakistan can deliver on time, he added.

LCCI president said contribution of newly-elected Prime Minister Shahid Khaqan Abbasi is “very much laudable.”  “The present government realised the problem of industry due to energy deficiency. So, concerted efforts were made to quell chronic power shortages,” he added.

Sources in the petroleum sector said Pakistan has proven itself as a reliable buyer of LNG and oil owing to the focused efforts of government and Pakistan State Oil. 

The sources said now suppliers are interested in delivering volumes to Pakistan at lower prices.   They added that a recent maintenance shutdown of LNG terminal – due to annual rehabilitation – with capacity larger than Qadirpur gas field confirmed the necessity of RLNG in the country’s energy mix and the positive impact it has on industry and country.

It has been more than two years since the first LNG molecules have been imported through RLNG terminal.  Industry officials said had LNG not been imported and plans to increase its volume not put in place amid delays in Iran-Pakistan and other gas projects, the industry’s sufferings would have been aggravated. 

They said Pakistan is no more importing fertiliser and instead is planning to export urea. As many as 750 compressed natural gas stations in Punjab, which were closed permanently due to non-availability of natural gas, are now functional, they added.