Pakistan's Indian LNG Imports Plans in Limbo

Pakistan’s plan to import LNG from India has hit a roadblock as stakeholders are unwilling to pay a higher import price in relation to the price of domestically-produced gas.

Khyber-Pakhtunkhwa (KPK) government had refused to bear the price difference between imported and domestic gas arguing that the province was self-sufficient in gas production, Business Recorder said citing sources in the government.

Oil and Gas Regulatory Authority (Ogra) refused to fix LNG prices, maintaining that LNG price should not be borne by all gas consumers. Furthermore, inadequate infrastructure for transport of LNG makes import unlikely during the upcoming winter months, sources said.

Locally-produced gas costs about $6 per Million Cubic Feet per day (MMCFD), while LNG would cost $18 per MMCFD. If the government imports 500 MMCFD LNG, tariff would have to be raised by 25 percent for all consumers.

Official said that India had already laid a 100-kilometre-long pipeline network to transport LNG to Bhatinda, from where a pipeline could be extended to Pakistan’s Wagha border for gas injection into the Sui Northern Gas Pipeline Limited’s network; but the laying of a pipeline on the Pakistani side would take time, which is not possible during this winter.

To deal with the serious gas shortage during the coming winter, the Petroleum Ministry had proposed import of 200 Million Cubic Feet (MMCFD) LNG per day gas from India which could be enhanced to 500 Mmcfd if an agreement ever gets signed.