Gas Crises Deepens In Pakistan, LNG Cargo Refused by Suppliers

May 28, 2023


Gas Crises Deepens In Pakistan, LNG Cargo Refused by Suppliers


ISLAMABAD: The gas crisis in Pakistan is predicted to worsen in the next month. The Italian LNG trading company, ENI, announced that it will not be able to fulfill its scheduled delivery of LNG cargo on February 6-7. A senior official from the Energy Ministry informed on Monday. 

The gas deficit is expected to rise as the amount of imported LNG will decrease to 700mmcfd in February. As per the limited supply of cargo available at higher prices. Only five cargoes will be available at 13.37% of Brent and two cargoes at 10.2% of Brent under agreements with Qatar. Additionally, there will be no LNG cargo from ENI at the cost of 12.14% available in February.

The authorities say that the consequences of ENI’s withdrawal will result in a decrease in supplies to the power sector. Moreover, the planned supply of 325mmcfd to the sector next month will not be met. This will lead to an increased reliance on furnace oil-based electricity, resulting in higher costs for end consumers. The captive power plants will only receive 50% of the gas they need, and there will be no supply of gas to fertilizer plants, compressed natural gas (CNG), and local industry.

Previously, the Petroleum Division had stated that ENI would not default starting from January 2023. When reached for comment, an ENI spokesperson also confirmed the development, stating that the disruption in February deliveries is due to an event of Force Majeure that is beyond the company’s control. Furthermore, the ENI does not benefit from the situation. The ENI defaulted five times in 2022; it failed to provide LNG cargoes in the months of March, May, July, September, and Novembe

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