PM Shahbaz Sharif to visit Qatar for more LNG supplies

ISLAMABAD: After the visit of the army chief to Doha, Prime Minister Shahbaz Sharif will soon visit Qatar for relief in LNG supply amid rising price of the product in the global market.

The higher military authorities earlier played a pivotal role in striking second GtG deal with Qatar for ten years in February 2021 during the PTI government at 10.2 percent of Brent which got operational on January 1, 2022. The PMLN government earlier in February 2022 signed the 15-year-long GtG deal at the price of 13.37 percent of Brent.

These contracts are not enough to cater to the country as Pakistan has to issue tenders seeking procurement of at least 4 spot LNG cargoes every month and amid the highest ever prices in the range of over $40 per MMBTU, LNG has become a rare commodity in the international market in the wake of gas crisis in Europe.

The higher military authorities visited Doha five days back and played a role in breaking the ice and persuaded Qatar high level leadership to provide relief with more supply of LNG at lower prices.

Federal Minister for Planning and Development Ahsan Iqbal also said last Sunday while referring to the higher military authorities' visit that the gas price has gone up in the international market, however, Qatar offered low price gas to Pakistan during the recent visit of the higher military authorities.

“Prime Minister is likely to go to Qatar maybe today (Tuesday) or tomorrow as a follow-up visit of The higher military authorities,” one of the PMLN leaders told The News. Earlier, the Qatar authorities told the government in plain words that it has no LNG available for more GtG contracts till 2024-25 as Doha is over-committed to Europe. Europe is facing an energy crisis as Russia has started closing down the Nord Stream -1 pipeline amid the news that European countries are involved in storing the Russian gas for next winter season. The US, UK, and EU have already imposed economic sanctions on Russia for war against Ukraine.

The prime minister is going to Qatar for more LNG supply contracts and may also seek some relief in the provision of more LNG cargoes under the deferred payment mechanism. Qatar is also a partner in the Enrages Terminal on which no construction work has yet started as Sui Southern and Sui Northern are not extending the required pipeline capacity the terminal management wants.

The boards of Sui Southern and Sui Northern have not yet approved the pipeline capacity for the Energas Terminal. The story of Tabeer Terminal is also not different from the Energas Terminal. Both will be constructed under a private-to-private model without any government sovereign guarantee. Under the private-to-private model, the LNG supply would be arranged by them and will be sold out to the private sector in Pakistan. However, both the gas companies are hesitant to give both terminals their required pipeline capacity fearing their clients will go to the private terminal for getting the RLNG at competitive prices. Right now both the gas companies have their monopoly in Pakistan in providing imported gas to all kinds of consumer categories.