KARACHI: The volume of LNG imported by Pakistan fell for the third consecutive month in October as the country struggled to make use of its second floating storage re-gasification unit (FSRU).
The Pakistan GasPort (PGP) terminal received just two cargoes in October, using one-third of its capacity. This was despite the country facing gas shortages as it enters the peak winter demand season. However, the first terminal i.e. Engro Elengy Terminal is running on full capacity of 600 mmcfd.
Pakistan is expected to face gas shortages this winter despite having two operational FSRUs. The country’s Oil & Gas Regulatory Authority (OGRA) has suggested that Pakistan’s growing number of gas customers is placing a severe strain on its infrastructure and affecting the availability of the fuel.
Industrial users have already been warned that their supply could be cut during the winter months to ensure there is enough gas for the residential sector.
Pakistan relies on natural gas to meet almost 50 percent of its energy needs but its proven gas reserves have dwindled in recent years, as consumption has outweighed new discoveries. Early LNG imports have been substituting for domestic gas, but the intention is to raise the share of gas in the nation’s energy mix by reducing the use of polluting and inefficient furnace oil and expensive diesel oil as power station fuels and increasing LNG purchases.
Six additional LNG import projects have been proposed for Pakistan by ExxonMobil, Shell, Trafigura, Total, Mitsubishi and Bahria Foundation. Most are planned for Port Qasim locations. If only four of the new schemes come to fruition, annual LNG deliveries to the country could reach 30 mta by 2025.
Of the proposed new LNG terminals, that being developed by a joint venture comprising Shell, Engro, Gunvor and Fatima Group is closest to a final investment decision. The plan calls for another 4.5-mta FSRU to be based at Port Qasim, and Excelerate Energy has been lined up to provide the vessel.
The project partners are aiming for a Q2 2020 start date. Unlike the country’s first two FSRU projects, which sell regasified cargoes to government agencies under guaranteed arrangements, this second Engro scheme and all the other proposed new Port Qasim facilities are targeting the private sector.
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