Pakistan Facing 2,000 mmcfd of Gas Supply Shortfall

Pakistan is facing a gas supply shortfall of over 2,000 mmcfd, country’s oil minister Shahid Khaqan Abbasi said on Thursday.

He said average gas production was 4,000 mmcfd against demand of over 6,000 mmcfd, Associated Press of Pakistan (APP) reported. Imports of LNG has enabled Sui Northern Gas Pipelines Limited (SNGPL) to ensure uninterrupted supplies to its consumers, he added.

The government is looking to further enhance supply of gas in the domestic market as it continues to work towards building LNG infrastructure. A deal has been signed to build second floating LNG import terminal. 

Pakistan’s first LNG import terminal has been functioning since last March. Engro Corp currently operates Pakistan’s first FSRU through Engro Elengy Terminal Private Limited (EETPL). The LNG terminal, utilising Excelerate's technology, is first of its type for the country and has been built at a cost of $125 million. The terminal has peak capacity for regasification of up to 690 mmcfd of LNG which provides for surplus capacity setup. The terminal received its first shipment in March 2015.

The south Asia nation signed its first long term deal earlier this year with Qatar. As per the deal signed in February, Qatargas will supply fuel to Pakistan State Oil (PSO) from 2016-2031. The price for each LNG cargo in a particular month has been agreed at 13.37 percent of Brent where Brent value is average of the preceding three months. Qatargas will supply 3.75 million tonne per annum (MTPA) of LNG to PSO. The 15-year long term deal is the largest deal of first quarter 2016, a report by GlobalData suggests. The deal has been estimated to be worth $16 billion.

IN June, a private sector firm, Global Energy Infrastructure Limited, signed a long term deal with a Qatari company. As per the sale-purchase deal, Qatargas will supply 1.3 million tons per year of LNG to Pakistan for 20 years, with provisions allowing the volume to increase to 2.3 million tons per year.