ETPL expresses inability to handle over 200mmcfd RLNG

KARACHI: Pakistan’s only liquefied natural gas (LNG) terminal operator Engro’s Elengy Terminal has expressed its inability to transfer more than 200 million metric cubic feet/day (mmcfd) of gas into the system under the present evacuation capacity of the Sui Southern Gas Company (SSGC), its official said.
Syed Mohammad Ali CEO of Elengy Terminal Pakistan (ETPL) said private sectors, interested in LNG imports, have to wait longer as the terminal is not yet ready to handle more than 200mmcfd of re-gasified LNG.
The SSGC’s network connection with the country’s first and only LNG terminal has a capacity to evacuate around 200mmcfd.
“Several parties asked us to utilise our idle capacity. We are not entertaining them,” Ali said. “The terminal is already observing a capacity utilisation of 80 percent and it would likely cross 100 percent by this year-end.” He said this is a completely new venture for Engro.
“We are still learning things. We might be handling private cargo and expanding the capacity. But, it is all quite premature at the moment,” he added.
He said the terminal’s present capacity will be doubled next year. He added that power and industry sectors may wish to have share in imports.
He termed the absence of end-consumer tariffs for the re-gasified commodity as another hurdle.
The Oil and Gas Regulatory Authority is yet to determine the consumer-end tariff for RLNG.
Ali said LNG business is quite promising due to an ever-increasing gap in gas supply and demand and amid limited alternate options.
The latest Economic Survey of Pakistan estimated the country’s gas demand-supply gap at four billion cubic feet/day (bcfd).
Domestic sector tends to overcome natural gas shortage by using liquefied petroleum gas (LPG) or kerosene as substitutes. But, both fuels are unsafe and expensive, Ali said.
For power sector, he said LNG is a cost-effective option, which is more efficient in power generation with lower operation and maintenance and transportation costs than other fuels.
Various estimates said Pakistan is expected to save as much as $1.5 billion/year by replacing LPG, diesel and furnace oil with one billion cubic feet of LNG.
Engro commissioned the floating storage re-gasification unit, having a capacity of 600 mmcfd, in a record time early in 2015.
Government signed a contract with the ETPL to supply 200mmcfd in the first year and 400mmcfd for the subsequent 14 years.
Ali said as per their contract with the government they would process 1.5 billion tons of liquefied gas a year, of which 28.5 billion cubic feet had already been pumped into the system.
About the National Accountability Bureau’s investigations into the LNG import and contract with the terminal operators, he said that the investigating authorities had not approached them as yet.