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December 3, 2020

Delayed import of LNG: Eyebrows being raised on Rs122 bn misappropriation

 
December 3, 2020

ISLAMABAD: Misappropriations and delay in import of Liquefied Natural Gas (LNG) once again surfaced on Geo News on Wednesday. It was reported in ‘Aaj Shahzeb Khanzada Kay Saath’ that eyebrows are being raised about the embezzlement of Rs122 billion and that Geo News possessed more evidence.

Host Shahzeb Khanzada said the media has been indicating to the prime minister that he was being misinformed and the country had already suffered the loss of Rs122 billion due to the late and bad decisions of the Ministry of Petroleum and Power. To conceal their blunder, Adviser to the PM on Petroleum Nadeem Babar has not been telling the truth, as he did say that the country might have experienced gas shortages during the winter season but his ministry did not timely open tenders for buying the LNG that had cost the country almost Rs122 billion.

Anchorperson Khanzada said the SAPM on Petroleum again conducted a press conference and once again he lied to the prime minister and the nation that the LNG was available on forward contracts but not on the prices of summer, as the rate of LNG in summer was US$2 to 2.5 per MMBTU, while in winter it surged up to US$4 to 4.5 per MMBTU. He said even if the LNG had not been purchased in summer and if the ministry would have done contracts, then billions of rupees could be saved. It is pertinent to mention that Pakistan had opened tenders in November, when the rate had gone 14 percent up and that meant the price for LNG would have been US$6 per MMBTU.

Meanwhile, the neighbouring India had opened tenders just three weeks earlier to Pakistan and got the LNG at US$4.9 per MMBTU and for making a three-week delay, Pakistan had to pay Rs2 billion extra. Khanzada suggested to the prime minister to ask the Adviser to the PM on Petroleum Nadeem Babar for the unnecessary delay for issuing the LNG tenders because Pakistan should have purchased the LNG three months before India had purchased. And interestingly the reports said if Pakistan had done the tenders timely, it could have saved Rs2 billion per month.

Being a technocrat, the SAPM on Petroleum should have advised the prime minister to purchase the LNG timely to help save billions of rupees of the country because he did not come in power through elections and he is supposedly the right guy to suggest on power and petroleum. He said Babar got the position to guide the government to save money and avoid controversies by using his professional experience. He demanded the prime minister to conduct an inquiry over the unnecessary delay to open LNG tenders as it might also reveal the beneficiary of the delay.

Reports said Pakistan had been offered US$5.7 per MMBTU for December’s delivery if the tender would have been opened in October but Pakistan had opened the tender in November for December delivery that cost US$7 per MMBTU and meant to pay 16.9 per cent extra. It said due to delay in LNG tender, the country may face loss of Rs30 to Rs35 billion during the winter.

Khanzada suggested four questions for the prime minister to be ask from SAPM Nadeem Babar: Why didn’t they arrange the LNG cargo when they knew there was nothing left in the terminal and they placed orders for six cargoes in December? Why did they invite tenders for December in November when the ministers had already informed the prime minister about the gas shortages? Why didn’t they place order like India when they knew the gas prices were constantly increasing in August, September and October? India saved billions of rupees by placing orders for November three weeks before Pakistan. Why didn’t they learn from their mistakes they had committed in August and September?

Khanzada said that they shouldn’t have erred again by inviting tenders late in October for November and the prime minister should ask them about this. Who benefited from the situation? Now Nadeem Babar was saying LNG couldn’t be bought at cheaper rates. “When we pointed out the mistakes committed in August and September, he put the blame on K-Electric,” the Geo News anchorperson concluded.