ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet has advised Petroleum Division to ensure that the demand of RLNG is firmed up at least three months in advance on a rolling basis.
This advice was issued at a recent meeting of the ECC when a summary of Petroleum Division regarding framework agreement between PLL and Azerbaijani Firm M/s SOCAR for LNG import came under scrutiny. Pakistan and Azerbaijan have signed a long-awaited LNG deal according to which Pakistan will receive one LNG cargo per month.
PLL had been importing up to 3 LNG cargoes per month through spot tendering conducted from time to time to meet seasonal peak demand.
Govt to buy LNG from Azerbaijan
However, PLL had been facing considerable difficulties in procurement of spot LNG cargoes since June 2022, owing to exorbitantly high international LNG prices as well as Pakistan’s downgraded credit rating.
PLL floated tenders for procurement of LNG on spot basis for delivery in July to September 2022, however, no bid was received from LNG suppliers. PLL also floated a midterm tender for supply of 72 cargoes (1 cargo/month during 2023-28), which also didn’t attract any bidder.
Meanwhile, PLL had also been exploring availability of LNG volume through Government to Government (G to G) agreements with different countries.
In this regard an Inter-Government Agreement (IGA) had already been signed between the Government of Pakistan and the Government of Azerbaijan on 28th February 2017 for cooperation in the field of Energy and Pakistan LNG Limited (PLL) and State Oil Company of Azerbaijan Republic (SOCAR), SOCAR Trading and its subsidiaries have been nominated to negotiate necessary contractual details on LNG project. In this regard PLL had stated that SOCAR had offered LNG cargoes through a Framework Agreement under the Government-to-Government arrangement.
Copyright Business Recorder, 2023
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