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Pakistan predicting a surge in LNG imports

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Reuters are reporting that Pakistan says it could become one of the world's top-five buyers of LNG, with the country predicting imports could jump more than fivefold as private companies build new LNG terminals.

Imports could top 30 million t by 2022, up from just 4.5 million t currently.

Cheaper than fuel oil and cleaner burning than coal, LNG suits emerging economies seeking to bridge electricity shortfalls and support growth on tight budgets.

That kind of jump would represent one of the fastest growth stories in the energy industry, comparable to what China has done in many commodities – but there are doubts whether Pakistan can achieve its ambitions, given the complexity and cost of expansion projects.

Pakistan built its first LNG terminal in 2015 and, after some delays, a second terminal is due to come online in October, doubling annual import capacity to about 9 million t.

A consortium of Exxon Mobil, Total, Mitsubishi, Qatar Petroleum and Norway's Hoegh is expected to decide by September whether to build a third LNG terminal for about US$700 million.

Pakistan has dropped plans to finance up to two more terminals, as private companies have said they would finance these themselves and use Pakistan's existing gas network to sell directly to consumers.

If Pakistan achieves its ambitious development goals, it could significantly erode market oversupply, which has helped pull down Asian LNG spot prices LNG-AS by more than 70% since 2014 to around US$5 per million British thermal units.

Pakistan is in talks with Russia, Indonesia, Malaysia and Oman about government-to-government deals for up to three monthly LNG cargoes for its second terminal, which can import 600 million ft3 of gas per day, equal to six cargoes a month.

Tenders for two of the terminal's six cargoes have already been won by trading house Gunvor and Italy's Eni, which have signed 5-year and 15-year deals, respectively. The contracts are worth about US$5 billion over their lifetime.

Qatar supplies most of the gas for Pakistan's first LNG terminal.

Read the article online at: https://www.lngindustry.com/liquid-natural-gas/11072017/pakistan-predicting-a-surge-in-lng-imports/


 

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