Pakistan secures LNG contracts at the highest rates

Pakistan has secured LNG contracts at the highest rates to meet the power sector’s needs and avoid power outages.

Earlier, Pakistan had failed to secure six LNG contracts even at the highest rates as the traders had not participated.

In response to an emergency tender floated in the international market, Pakistan LNG Limited (PLL) received the lowest bids for liquefied natural gas (LNG) cargoes for delivery windows in May from Total Energies Gas & Power. However, PLL had received six contract prices for LNG cargoes out of seven.

Following contractors’ cancellation of committed cargoes, the PLL sought cargoes urgently.

PLL awards LNG contract at a record high price of $30.6 per MMBtu

PLL received the contract price for a cargo requested for May 1-2 delivery at the highest rate of $29.67/MMBtu from Total Energies Gas & Power. The second bid for the same delivery window was received from Vitol Bahrain at $29.7920 per MMBtu.

Pakistan, which has increased its dependence on LNG due to depleting indigenous natural gas deposits, issued a separate tender for six deliveries in May and June earlier this month.

Qatar Energy quoted the lowest bid for May 12-13 delivery at $25.15 per MMBtu and the June 6-7 delivery window at $27.65 per MMBtu.

Total Energies Gas & Power quoted the lowest bids for the May 17-18, May 27-28, and June 16-17 deliveries at $31.77 per MMBtu, $26.87 per MMBtu, and $29.04 per MMBtu.

So far, there has been no bid for delivery for the June 1-2 window, industry sources said. The final decision on acceptance or rejection will be taken at a board meeting of PLL.

The CNG station association and the general industry hoped to reintroduce the gas, which gas utility had suspended due to a shortage earlier this month.

“In this difficult time, the government has taken a bold step and purchased LNG from the international market to reduce the gas shortage and gas supply to power plants specifically and other consumers,” Ghiyas Paracha said.