Govt procures 30pc additional LNG at cheapest-ever price for January

ISLAMABAD-The Pakistan Tehreek-i-Insaf (PTI) government has procured almost 30 per cent additional Liquefied Natural Gas (LNG) for the current month as compared to the same period of 2018, the last year in the government of the Pakistan Muslim League-Nawaz (PML-N).

“Pakistan will be moving 30 per cent more LNG molecules in this January compared to January 2018, at the cheapest-ever price of $6.34 [per MMBTU] for a peak winter month,” a senior official privy to petroleum sector developments told APP. He said the government had arranged 12 LNG cargoes for January 2021. 

He also shared a comparative statement about the purchase of LNG for a period from December-2017 to January-2021, which showed the present government procured the commodity at the lowest rate for the current and next months. He said the government procured 12 LNG cargoes each for the months of December-2020 and January-2021 at the average cost of $ 6.35 and $ 6.34 per Million British Thermal Unit (MMBTU), respectively.

Making a comparison, the official said, in December-2017 and January-2018 nine cargoes were purchased each in two months at the rate of $ 7.50 and $ 8.49 per MMBTU gas, respectively. While in December-2018, as many as eight LNG cargoes were acquired at the rate of $9.73 per MMBTU and 10 ships at the average cost of $ 8.82 per MMBTU in January-2019. Similarly, the government procured 10 and 11 cargoes in December-2019 and January-2020 at the rate of $ 7.81 and $ 7.61 per MMBTU, respectively. Special Assistant to the Prime Minister on Petroleum (SAPM) Nadeem Babar in a recent statement said that provision of gas to domestic consumers was the topmost priority of the state-owned companies –  Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company (SSGC). The SAPM said the commodity supply had been suspended to Compressed Natural Gas (CNG) sector and non-export industries to provide gas to domestic consumers. As per the agreement, he said, the companies were not bound to supply gas to captive power industries during the winter; however, the SNGPL and SSGC continued supplying the commodity to them by last week of December 2020.

Nadeem Babar was of the view that non-export industries could switch over to electricity due to non-availability of gas in the peak winter season. He said there was a significant decline in the local production of the gas, adding, the shortage was being met through increased import of the Liquefied Natural Gas (LNG). The SAPM said the demand of domestic consumers in December and January usually increased by two-fold and hoped that the gas pressure would normalize in the coming two weeks.