Pakistan Signs Deal for Second LNG Terminal

State-owned Pakistan LNG Terminals Limited (PLTL) has signed an operations and services agreement (O&SA) to establish country’s second LNG import terminal, according to Business Recorder.

The agreement was signed between PLTL and Pakistan GasPort Consortium Limited (PGPC), which includes Fauji Oil Terminal and Distribution Company Limited (FOTCO), on July 1, 2016.

PGPC will provide PLTL with 600mmcfd of tolling capacity by June 30, 2017, at a levelized tariff of $0.4177 per mmbtu. The tariff offered by PGPC in the international tender process is the lowest in South Asia, government officials told Business Recorder.

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.

Pakistan 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.

Last month, 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 tonne per annum of LNG to Pakistan for 20 years, with provisions allowing the volume to increase to 2.3 million tonne per annum.