Khaqan Abbasi said imported LNG was only cheaper source to meet the country's energy requirements with saving massively to the national kitty.He said past three governments made five attempts over the ten years to import LNG, but they failed for adopting integrated approach where LNG terminal developer was also LNG supplier. He said the PML-N government resorted to un-bundled approach and the LNG terminal development was separated from LNG procurement, thus succeeding to provide the country with its first LNG-based gas within 20 months of its tenure.The minister said LNG was a game changer and the 400 mmcfd LNG terminal would add five percent to the country's primary energy mix. He said average re-gasification tolling fee was charged at $0.66 per MMBTU which was the lowest in the world, adding most LNG contracts in the world were priced at direct linkage to oil and Pakistan LNG imports would also be linked to oil.
Khaqan said the government was displacing oil products and LNG price at 15 percent of Brent index of $50 percent would be $7.5 per MMBTU. He said since the country's natural gas production was stagnant at 4,000 mmcfd per day for 10 years and constrained demand stood at 6,000 mmcfd with hydrocarbon resources fast depleting, thus the government ventured into LNG import. He was of the view if Pakistan had committed to LNG 10 years back, the country would not have no energy crisis, today. He said Pakistan needed to import natural gas through pipelines or LNG, but in fact Iran-Pakistan Pipeline of 750 mmcfd project was delayed due to international sanctions and the first gas could not be available before end of 2017.
In addition, Turkeminstation-Afghanistan-Pakistan-India (TAPI) pipeline with 1325 mmcfd also got delayed due to Afghanistan instability and structural issues with the project transaction and first gas could not be available before 2019. In such situation, the government venture into the LNG import through long term contracts, medium term contracts and sport purchases, adding LNG supply contract (SPA) between Pakistan State Oil (PSO) was finalised. He said cost calculations proved that RLNG was a cheaper than all imported fuels and the OGRA had determined RLNG price of 8.64 per MMBTU. He said so far 14 LNG cargoes had been re-gasified at the LNG terminal, adding the one-year contractual commitment was 24 cargoes, but the number could go up in one year to 26 cargoes. He said six cargoes were procured on spot basis from Qatar gas FOB basis and eight cargoes were procured through competitive bid process, adding average price of LNG cargoes procured was less than 14 percent of Brent. He said power generation based on 4.000 mmcfd of regasified RLNG would generate additional annual generation of nine billion KWH, saying from $600 million to one billion dollar. Similarly with under-construction of 3,600 MW RLNG based power plants would generate 30 billion KWH, saying over$ 2billion annually. The Minister told,"we are providing 3,00,000 gas connections annually as permitted by OGRA However we would end the backlog of urgent gas connection cases by the end of June 2016. we are trying to resolve the problems of tail-end domestic as well as commercial consumers.The Minister said that we are taking measures to check the adulteration of kerosene oil in Diesel and we would not let mixing in high speed diesel.The minister said that Rs.150 billion were being spent on gas pipeline from the GIDC.The Minister said During current tenure of the PML-N government, record 227 wells have been drilled, which resulted in 71 new oil and gas discoveries.With new discoveries,he said, over one trillion cubic feet (TCF) of gas and 16 million of barrels of new oil reserves had been added to the system. The country,he said, was moving on a fast track towards achieving autarky in the energy sector as all-out efforts were being made to achieve the target by utilising conventional as well as non-conventional reserves like tight gas, shale gas and marginal fields and British thermal unit (BTU) gas.Under these steps, the minister said, around 560 million cubic feet per day (mmcfd) of additional gas and 27,000 barrels per day (bpd) of oil have been injected in the system so far due to the government’s effective policies.
