PLL invites bids for 6 LNG cargoes in January

KARACHI: Pakistan is looking to import six additional liquefied natural gas (LNG) cargoes of 140,000 cubic meters each for coming January as energy demand continues to rise in winters, it was learnt on Tuesday.

State-owned Pakistan LNG Limited (PLL) invited bids for import of the LNG cargoes to be delivered in January 2021. PLL last month issued a tender of six LNG cargoes to be delivered next month.

The country has increased spot buying of LNG given the growing demand of gas in winters.

An advertisement by PLL said the country is seeking cargoes – each of 140,000 cubic metres in six delivery windows – and December 10 is the deadline for submission of bids.

The first LNG cargo will be delivered on 8-11 January, second on 12-14 January, third on 15-18 January, fourth on 20-21 January, fifth on 26-27 January, while sixth cargo will be delivered on January 29-February 01, 2021 on a delivered ex-ship basis, according to PLL.

December and January see the largest spike in demand for gas in Pakistan, but this year the demand-supply shortfall will be greater on the back of higher consumption and diminishing indigenous supply.

There would be a shortage of 250-400 million metric cubic feet per day (mmcfd) of gas on the system of Sui Southern Gas Company that would affect all sectors, including industrial and domestic consumers in Sindh and Balochistan. Sui Northern Gas Pipelines that feeds Punjab, Khyber Pakhtunkhwa and Kashmir would also face 300-350 mmcfd in peak winter season.

Pakistan has long term LNG agreements in place, including one with Qatar, but has also been active on the spot market since August.

The country has a 15-year LNG purchase deal with Qatar to buy 3.75 million tons of LNG per year for 15 years to 2030, but it regularly taps the spot market. It also has a five-year import deal with commodity trader Gunvor and a 15-year agreement with Eni.

LNG contributes 22 percent in the country’s energy mix, while its share in energy imports stands at 24 percent. Since 2015, more than 19 million tons of LNG has been imported. There are two re-gasification LNG terminals that have pumped approximately 393.6 billion cubic feet/day of gas into the national gas distribution network in 2019, a 14 percent increase compared with 345.6 billion cubic feet in 2018.