ISLAMABAD: Pakistan failed to receive any bids for delivery of six cargoes of liquified natural gas (LNG) in October and December in a sign that the country’s energy crisis may worsen this winter.
Pakistan LNG Limited (PLL), a government subsidiary responsible for procuring the commodity from the international market, had issued the tender after a gap of almost a year. It had last issued a tender in July 2022 which failed to receive any bids amid record high LNG prices in the spot market following Russia’s invasion of Ukraine.
The latest tender, which closed on June 20, sought 140,000 cubic meters of LNG per cargo on a delivered-ex-ship (DES) basis at Port Qasim in Karachi. However, the evaluation report shared by the PLL on its website on Tuesday showed the tender failed to attract any bids.
Pakistan relies heavily on LNG for its energy needs — it accounts for over a third of the country’s power output — and the latest failure to attract bids raises concerns that the energy crisis could worsen in the upcoming months, with prolonged loadshedding and reduced supply to industries.
Pakistan has struggled to meet its LNG requirements due to supply constraints and rising prices as Western countries rushed to buy the commodity following disruptions in the wake of the Russia-Ukraine conflict.
In 2021, Pakistan imported nine billion cubic meters (bcm) of LNG, a nearly 20% decline from the previous year. The country has long-term supply agreements with Qatar, totaling 6.75 million metric tons per year, and an additional contract with ENI for 0.75 million metric tons per year. However, spot cargoes are essential to meet the country’s growing energy demands.
Stakeholders will now closely watch the second tender issued by the PLL for delivery of three cargoes in January and February, which closes on July 14. __profit.pakistantoday.com.pk
