Private entities keen to supply 300mmcfd gas to industries: SAPM

KARACHI: Several private entities have shown keen interest in providing 300mmcfd of liquefied natural gas (LNG) from Gwadar to the industries in Karachi, a government official said on Friday.

Special Assistant to Prime Minister on Power and Petroleum Tabish Gauhar tweeted: “Aside from meeting [the] industrial gas demand in and around Karachi (without the need to physically access the Sui’s pipeline network), this proposal may potentially make available 150mmcfd of RLNG [re-gasified liquefied natural gas] that [the] Sui Southern Gas Company (SSGC) is currently retaining in their system, and accordingly release the same to meet the deficit up North in the Sui Northern Gas Pipelines Limited (SNGPL) system,” he added.

Short Term (6-12 months) :

2- Virtual LNG Pipeline from Gwadar : pic.twitter.com/uZ3dpOfi74

Advertisement

— Tabish Gauhar (@TabishGauharPK) July 9, 2021

“Our government is determined to reform the gas sector and for this purpose, we have devised a strategic work stream that is further divided into 3 [three] parts; short-, medium- and long-term,” he added.

“We now have a comprehensive draft policy in place (post-numerous discussions with key stakeholders), but [the] need to get it through the internal approval process by [the] end [of] July 2021 to enhance and accelerate [the] supply of this alternative fuel to domestic consumers and correspondingly reduce the burden on [the] natural gas provision via pipeline network.”

The special assistant to the prime minister said in the short-term, there could potentially be up to 300mmcfd (3+ additional LNG cargoes/month) of excess capacity available at the existing two RLNG terminals (that may be utilised on a strictly private-to-private, i.e., without any government “take or pay” payment obligation and on an open/third party access bases) to further bridge the demand-supply gap, especially in the coming winters for the domestic gas consumers, under a “without prejudice” arrangement sanctioned by the Oil and Gas Regulatory Authority.

Gauhar expressed the hope that the two new merchant LNG terminal developers would achieve financial close and start construction this year. “We do need at least one additional import terminal (without any “take or pay” commitment on the part of the government) by 2023.”

He stressed the need to make substantive headway with the Russian consortium in the next couple of months on the additional Karachi-to-Lahore gas pipeline, which is of critical importance to Pakistan’s energy security.

“As per the PM’s directive, this infrastructure asset needs to be completed as soon as possible, at a price affordable to the consumers, and with [the] maximum involvement of our local companies, know-how and material.”

Gauhar said that the already collected gas infrastructure development surcharge will be used in the construction of on-ground LNG storage facilities at Port Qasim (up to 10 days storage in Phase 1) and, in this regard, the Oil and Gas Regulatory Authority is finalising the third party access rules.