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A former finance minister was seen lamenting the government of being complicit on LNG imports, going on to say Pakistan is paying significantly more than any of the other leading LNG importer in the world. He was not quite on point. The only time Pakistan paid anywhere close to “significantly” higher than other LNG importers was back in 2015. He was not the finance minister then, but the party he represents was sure at the helm.

In fact, Pakistan has mostly been at par, or at times even better off the other LNG importing countries, when it comes to unit pricing. Pakistan is the fifth largest LNG importer, and often gets flak in the media for having missed the boat to secure RLNG at dearth cheap rates. If ‘experts’ are to be believed, likes of India and Bangladesh were supposedly nailing one contract after another, of significantly cheap LNG. In a parallel universe though.

LNG market, like any other hydrocarbon and fuel market, is highly competitive. Barring instances of extremely lopsided long-term contracts, landed import prices in markets where sizeable quantities are imported, will naturally tend to even out.

Now, one can argue that the long-term deal with Qatar could have bene negotiated better. But then, things always look rosier in hindsight. Pakistan has not paid dearly, as against the general perception, for the long-term deal. Not just yet. Granted that the average price of all spot cargos at 12.5 percent of Brent crude is lower than 13.37 percent of Brent for the Qatar deal. But this is not that much of a difference to make all hue and cry about.

Also remember that the long-term deal gives a sense of comfort in terms of timely availability, and when the demand peaks in winters, spot prices are usually seen trending much higher than the Qatar rate. Had there not been the long-term deal in place, Pakistan would be struggling to arrange timely cargos, in addition to paying more for much larger quantities.

This is not to say the deal could not have been inked better. There is enough potential for the demand to double in the next five years from the current range of 7-8 million tons per annum. The quantum of Qatar deal could soon become too insignificant to have that big a bearing on weighted average price.

There are those who quote USA spot prices and then criticize why can’t Pakistan import spot cargoes from the USA instead. Yes, the USA spot prices is at times as low as four times from that of Qatar or other players in the region. But even in today’s day and age of technological advancement, the LNG can’t be shipped in data packets via satellite – and the transportation cost continues to be a big chunk. Little wonder then, the imported unit value of the RLNG from the USA, is at times higher than the nearest available vessel.

Long story short, LNG has more issues than just simply harping about the long-term and spot debate, winter after winter. There are technical improvements to be had, terminals to be laid, distribution losses to be reduced, consumer pricing to be sorted. One hopes the focus now turns towards more substantive affairs.