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September 23, 2019

A rare breed in politics: Unbelievable stories of Shahid Abbasi coming out of NAB detention

Top Story

September 23, 2019

ISLAMABAD: On a lighter note, one day Shahid Khaqan Abbasi asked the NAB officials investigating him in custody, if there could be a NAB case against him for appointing the NAB chairman.

What is however rarely done and witnessed in the past, Abbasi has conveyed to all concerned officials and others associated with the LNG-related cases including Miftah Ismail and Sheikh Imranul Haq - who are also in the NAB custody - to shift all the responsibility on him to save them from the Bureau’s alleged persecution. His party and family sources confirm that Shahid Khaqan Abbasi takes full responsibility for the entire LNG project.

“He had anticipated that the NAB would eventually arrest Miftah, Sheikh Imranul Haq and several others to put pressure on him. Several weeks before the arrest, he asked his son to reach out to them and let them know that they may do or give any statement they wanted to in order to avoid being locked up by NAB. He said that he wouldn’t hold it against them if they become approvers just to stay out of jail/NAB custody,” the sources said.

Some of them, it is said, such as ISGS MD Mobin Saulat and ex-secretary Petroleum Abid Saeed have done just that and given statements against the minister (shifting all blame on him) and absolving themselves of any blame or purported wrongdoing.

The sources said that Shahid Khaqan Abbasi has even told the NAB that he is willing to take all responsibility himself and that Miftah and Imranul Haq have nothing to do with this case and that both should be released immediately.

Meanwhile, an indirect interaction of this correspondent with the arrested former premier through some credible sources shows that it has now been over a year of answering ‘questionnaires’ with what Abbasi considers “most ridiculous” and “illogical repetitive” questions.

Initially, it was the Qatar LNG procurement that the NAB focused on and issued statements calling it “corrupt”. The answer from Abbasi is simple; it was then and still is the best negotiated long-term LNG deal in the world. Even the Japanese, who buy annually twice the amount of LNG that Qatar produces, were amazed because we had lower prices and better terms.

Abbasi says that the Qatar LNG deal has a lower price per mmbtu than both the Iranian gas from the Iran-Pakistan Pipeline and the Turkmenistan gas from TAPI. This has never happened before; that pipeline gases were 15-20 percent more expensive than LNG.

LNG and gas are commodities affected by market influences, but the long-term Qatar LNG deal saves Pakistan 150 to 250 billion rupees every year just in power generation when compared to fuel oil generation, other benefits aside. Not only that the NAB could not find anything in the LNG Pak-Qatar deal but the media recently reported that Qatar is upset with the Imran Khan government for politicising the project.

It is said that Qatar Minister for Energy and CEO of Qatar Petroleum Saad Al-Kaabi recently came to Pakistan for four hours and said to Prime Minister Imran Khan, “If you want LNG, take it otherwise cancel the contract. Don’t drag our name through the mud for your politics. Then I will see who sells you LNG.”

Following these developments, the NAB investigation into the Qatar LNG deal appeared to have halted.

Then comes the contract for the LNG regasification terminal in IPP mode between the SSGC and Engro through a transparent and competitive bid process. This had been investigated by NAB in 2014-2015 when SKA was petroleum minister. It was Abbasi who wrote to the NAB chairman that he wants to appear before the inquiry as minister for petroleum and answer any question as this was an issue of national importance. He appeared for four hours before the NAB team and explained everything to them; and the matter was officially closed.

Now the NAB has reopened the case and arrested Miftah Ismail, who was non-executive chairman of SSGC BOD, and Sheikh Imranul Haq, who was CEO EETPL, the Engro subsidiary that submitted the lowest bid for the regasification terminal.

SKA’s stance is that the contract was done through an open transparent bid process and it was handled by the same consultant, who had done three similar bids earlier for SSGC. The consultant was selected and provided for by USAID through their own tender process. All charges to the consultant were also paid by USAID. The terminal contract was completed on time; within the stipulated time period of 11 months. As a comparison, the first Indian LNG terminal took seven years and the first Bangladesh terminal took five years to build.

Engro Terminal is the only LNG terminal worldwide operating at 100 percent capacity for the last 4-5 years. It is said that its current regasification charge of 46 cents/mmbtu including port fees, tax and other charges is the lowest in the world. Charges in India average over $1/mmbtu. Pakistan in five earlier bids before this one had never received a price below $1.1/mmbtu.

It is claimed that this terminal saves Pakistan a minimum of $1.2 billion per year in reduced power generation costs after paying the charges for the terminal which average $90 million per year. There is no government subsidy for this terminal and the government pays none of its costs. All charges are paid by the consumer.

The economic benefits of the Terminal are huge, SKA says, adding for example, because of this terminal we went from urea Imports of 1 million tonnes/year to exports of 600,000 tonnes in 2017. Before this terminal, Pakistan was the second largest importer of fuel oil in the world; China was number one. Today our fuel oil imports are zero.

He explains that the daily charges for the terminal are $225,000 at 100 percent capacity. As a comparison, a 250MW capacity power plant is paid a capacity charge of $200,000/ day and 1300MW capacity power plants are paid close to $1m/day. The Engro LNG terminal regasifies/processes enough gas to produce over 4,000MW of power per day.

There is no government investment in this project. It involves the same IPP model that Pakistan has been doing with its power plants since 1994, except here instead of an upfront tariff you have the price discovery through a bid mechanism which is much more transparent and market-based. It is the same mechanism that Pakistan had used in its five failed bids earlier.

The project was completed on time-world record time for an LNG terminal, operating successfully at 100 percent, lowest tariff in the world, no government investment involved and saves Pakistan a minimum of $1.5 billion per year in generation costs.

With these facts, Shahid Khaqan Abbasi asked the NAB that if it is accusing him of corruption, then it means he took money. He raised the question, how does one take money in an open bid? If he took money, who paid the money? Engro? Pakistan’s largest corporation? Why don’t you charge Engro as well?.

The sources said that the NAB has no answers to these questions. Of late, the NAB investigators told him that they are not accusing him of financial corruption but “misuse of authority”. In response, Abbasi told them, “Okay, what authority does a minister have that he can influence a bid process. And why would I influence a bid process if I wasn’t receiving any personal gain from it; Engro is not owned by a relative of mine.”

The investigators have no answers to this but came up with a new idea, “We should have built the terminal ourselves, as it’s very simple.” They were told by SKA why don’t you just try making the drawings for an LNG terminal. Then you will find out.

Pakistan import over $10 billion worth of oil per year. Oil terminals are very simple as compared to LNG regasification terminals. Despite that, PSO does not own and operate oil terminals? Why? SKA raises these questions and then responds, “Simply because PSO cannot afford to take operational and performance risk on an oil terminal. They are operated by specialised companies.”

It again makes the investigators clueless.

SKA also told his investigators whether they want to challenge decisions made by the federal cabinet. He told them in the last 30 years, the Government of Pakistan has attempted to build three projects - Nandipur Power Project, Neelum-Jhelum Hydel Power Project and New Islamabad Airport. He told NAB investigators that all of these projects were completed three or more times above cost, took a minimum of three times more to build and are all performing below standards.

An LNG regasification terminal is much more complex than any of these projects. Abbasi told the NAB officials that with its working style, thought process and the mindset at NAB, the Bureau is out to destroy the country. Then the icing on the cake for Abbasi comes. He was asked that as per foreign ministry files, he being the prime minister was using vehicles which belonged to the Foreign Office. Abbasi’s response was: which Foreign Office, the Indian foreign office? Did I ask for any vehicles?

“If you had a problem and didn’t have vehicles you should have informed me, I could have called my son or used Uber. And I said which vehicles is the current PM using? The same?,” a source quoted SKA as saying.

Then, the sources add, the NAB wanted to make a case for not appointing MD OGDCL. Abbasi told the investigators, the qualified people he found did not join because of fear of NAB. Then the Bureau’s probe was further extended and focused on the appointment of MD PSO and MD Pakistan LNG Limited.

AKA responded that the current government has not been able to appoint anybody, even on the BoD for state owned enterprises. Nobody credible or qualified wants to join due to fear of NAB and the blatant victimisation that comes along with it. Sources quote SKA telling that there is much more to share, and lamented, “This is a never-ending joke.”