Private sector invited to procure 700mmcfd RLNG

KARACHI: The government has invited proposals from private sector to procure unutilised re-gasification capacity of at least 700 million metric cubic feet/day (mmcfd) for the next six months, it was learnt on Friday.

State-owned Pakistan LNG Limited (PLL) invited interested parties seeking allocation of its unutilised contacted capacity on a short-term basis and to review the draft agreement and transaction framework for allocating the unutilised contracted capacity.

“The unutilised contracted capacity shall be made available to all interested parties, which fulfill the eligibility criteria at Oil and Gas Regulatory Authority determined charges for the relevant month,” an official document said.

PLL imports liquefied natural gas (LNG) at the terminal located at Port Qasim and supplies re-gasified LNG (RLNG) into the network of gas utility companies. PLL utilises its contacted capacity depending on the requirement of RLNG by the gas utility companies.

The government has authorised PLL to allocate its unutilised contracted capacity to private parties on a short-term basis, depending on the requirement of the gas utility companies.

For October, the utilised capacity stands at 150 mmcfd. It is 200 mmcfd each for November and February and 150 mmcfd for March.

Estimates of December and January are not available.

The last date of submitting the application for allocation for any specific month or for the entire period is 9 October. The prospective applicants may submit their interest along with queries to PLL on 2nd October to participate in the consultative session.

“In case the total requirement of the qualified parties exceeds the total available unutilised contracted capacity, individual capacity allocations will be adjusted proportionally,” said the document.

The federal government already raised objection over the Sindh reluctance in promoting RLNG as an alternative energy source because of price concern.

Pakistan currently has two operational LNG terminals – Elengy Terminal and Gasport Pakistan Ltd. having a capacity of 600 mmcfd each. Pakistan is becoming one of the fastest growing LNG markets. It first started importing LNG in 2015. LNG Imports rising to 8.4 million tons in 2019 from 6.8 million tons in 2018.

Commodity information provider S&P Global Platts forecasts Pakistan’s LNG imports to rise to 9.3 million tons in 2021, if the country can bring in another floating storage regasification unit. Imports are expected to exceed 17 million tons by 2025, it said.

The gap between demand and supply is expected to increase to 2.7 billion cubic feet per day (bcfd) in FY2023 and 4.8 bcfd by FY2028 without the imported gas.