Business
Pakistan attracts new LNG crisis
Pakistan is about to face acute shortage of LNG and the highest prices.
Pakistan was not even able to collect a single offer for three Liquefied natural gas (LNG) cargoes for the first half of January and drew the high prices for the second half of January, largely due to delayed tenders in the light of rising international prices.
The official said that in October, the government had pre-ordered a $6 per mmBtu ship primarily aimed at delivery using contractual flexibility, however it met with $13 and $15 per mmBtu. At $6 per mmBtu, an estimate of 3.2 million mmBtu shipment operated at around $19m, while at $15.28 per mmBtu the same cargo will charge about $49m—almost $30m way more costly.
He demonstrated that at $15.28 per mmBtu, LNG was almost $85-90 per barrel of oil relative to the current Brent price of around $50 per barrel. “This is economically impractical even for the power sector and politically suicidal for the PTI-government,” added an official,
His remarks suggested that the government would have to withdraw from these bids. The private firm’s executive exclaimed that “there was no logic of downward flexibility of January to October”. The private firm owners were appealing for third party access to order low-cost supplies.
