ENERGY UPDATE: Five Consortia To Build Five LNG Terminals in Pakistan

Pakistan is also pursuing higher local gas production. The resources seem to be there, according to estimates.

DESPARDES NEWS MONITOR — Five consortia have been picked by the PTI-led government in Islamabad to build five additional LNG import terminals. These include Shell and Exxon supermajors, as well as Mitsubishi Corp, Energas, Trafigura, and Gunvor.

The move is part of Islamabad efforts to boost natural gas imports to deal with shortages in supply, and at the same time make efforts for local production.

The environmental friendly clean energy resources seem to be there in Pakistan, according to estimates.

These terminals for LNG import will meanwhile fill the demand-supply gap and later could be used also for export, an energy expert says.

Reuters reports that the terminals could be operational in two to three years, quoting the country’s oil and power minister, Omar Ayub Khan.

Pakistan is presently heavily dependent on imported fuel. Though there is some local fuel production with changes in the energy mix basket, in financial year 2017/18, demand exceeded supply. In gas it exceeded by about 3 billion cu ft daily. Imports of gas and LNG are already on the rise but not fast enough to ensure demand-supply equilibrium.

The consortia must submit their detailed plans for the terminals for government approval by November 5, although Reuters quoted PM Khan as saying this approval had already been granted.

Pakistan currently has LNG import capacity of 1.2 billion cu ft per day in two terminals, with plans to add a third with a capacity of 600 billion cu ft daily in 2020. One billion cu ft of natural gas equals about 21,000 tons of LNG.

Last week, the Inter State Gas Systems (Private) Limited (ISGS) and the National Iranian Gas Company (NIGC) signed a revised agreement for the much-delayed Iran-Pakistan (IP) gas pipeline project.

Pakistan can build the IP pipeline till the year 2024 for buying 750 million cubic feet of natural gas per day (MMCFD) from Iran.

Besides imports, the country wants to open up its gas deposits to foreign energy companies, and earlier this year a senior government official told Reuters, “I expect in the second half of this year we will be auctioning at least 10, if not 20 blocks for exploration.”

Pakistan has conventional gas reserves of 20 trillion cu ft and shale gas reserves exceed 100 trillion cu ft. So far, the authorities have delineated more than 30 gas blocks, all onshore.

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