ISLAMABAD: Amid Growing Electricity Shortage Pakistan on Wednesday received the lowest offer from PetroChina International Singapore. for spot transportation of liquefied natural gas (LNG) for supplies in in first and last week of June.
Against his spot tender announced on April 30 for two loads in June, state-run Pakistan LNG Ltd (PLL) received total of five bets out of three qualified bidders are PetroChina, TotalEnergies and Vitol Bahrain. Tenders were originally announced for first and third week of June, which was later moved to last week.
PetroChina offered the cheapest spot cargo at $23,968 and $22,498 per million British thermal units (mm Btu). for Delivery June 1-2 and June 28-29 windows, respectively. Behind first slot of On June 1-2, the only other bid came from TotalEnergies at $25.77 per mmBtu.
For second slot of June 28-29, Moscow total of received three applications with Vitol Bahrain is offering $22.94/mmBtu and TotalEnergies is $25.89/mmBtu.
On April 29, PLL received an offer from Vitol. for delivery window May 17-18 at $23.13/MMBtu as new coalition government stepped up fresh efforts for LNG imports to meet rising power requirements in unusual higher summer temperatures.
Previously PLL also confirmed four of seven point loads he was looking for for May and June through tender. However, he dropped the load for window May 17-18 for be too expensive at $31.77/MMBtu from Vitol. decision worked well and the same company later offered a revised rate of $23.13/MMBtu for same delivery window in in second round emergency rate.
PLL is public industry organization with mandate from government buy LNG from international markets and supply it to local gas supply companies – SSGCL and SNGPL – in addition to direct sales in Karachi. private power utility – K-Electric.
Seven to eight cargoes mostly from Qatar, average LNG supply to Pakistan price was about 11-12 dollars, but because of higher spot prices, PLL rarely accepted bids above $25/MMBtu during its tenure. of PTI government.
At the same time, Pakistan will receive total of 11 loads each in May and June, including long term contracts with Qatar. This will mean that LNG Terminal-1, operated by Engro, will operating almost in full capacity on Pakistan State Oil’s LNG cargoes from Qatar, while Terminal 2, operated by the Pakistani gas port, will handle 4-5 cargoes each. in May and June, including two under long-term term a contract from Qatar and three spot cargo secured by PLL.
Pakistan was already in grip of power shortage of three to seven hours the day before last month as PTI government hesitated ordering spot LNG tenders while term suppliers defaulted on almost a dozen in winters among the flying world market.
The authorities have also was struggling arrange heating oil up for LNG break, but in extra monthly fuel process cost adjustments have been made more than twice over reference prices, resulting in in up up to 6 rupees per unit of additional electricity costs in recent months. Against the firm power sector demand of up up to 900 million cubic feet, gas companies were struggling meet even half of what, calling all over the country power cuts.
Shortly after coming to power, coalition government, however, has taken an aggressive stance in LNG tenders and has since achieved total of about seven additional loads for two months – May and June – for maintenance power shutdowns that have again resumed after a week break of Eid al-Adha.
Published in Dawn, May 12, 2022