AGL 6.80 Decreased By ▼ -0.03 (-0.44%)
ANL 9.41 Increased By ▲ 0.04 (0.43%)
AVN 79.00 Increased By ▲ 1.25 (1.61%)
BOP 5.45 Increased By ▲ 0.03 (0.55%)
CNERGY 4.96 No Change ▼ 0.00 (0%)
EFERT 78.64 Increased By ▲ 0.74 (0.95%)
EPCL 56.11 Increased By ▲ 0.35 (0.63%)
FCCL 15.60 Increased By ▲ 0.30 (1.96%)
FFL 6.36 Decreased By ▼ -0.01 (-0.16%)
FLYNG 8.10 Decreased By ▼ -0.09 (-1.1%)
GGGL 10.14 Decreased By ▼ -0.18 (-1.74%)
GGL 16.28 Decreased By ▼ -0.37 (-2.22%)
GTECH 8.62 Decreased By ▼ -0.57 (-6.2%)
HUMNL 6.45 Increased By ▲ 0.09 (1.42%)
KEL 3.00 Increased By ▲ 0.06 (2.04%)
LOTCHEM 29.24 Increased By ▲ 0.34 (1.18%)
MLCF 28.25 Increased By ▲ 0.45 (1.62%)
OGDC 74.79 Increased By ▲ 0.19 (0.25%)
PAEL 16.08 Increased By ▲ 0.07 (0.44%)
PIBTL 5.45 Decreased By ▼ -0.09 (-1.62%)
PRL 16.98 Increased By ▲ 0.06 (0.35%)
SILK 1.21 Increased By ▲ 0.10 (9.01%)
TELE 11.57 Increased By ▲ 0.60 (5.47%)
TPL 7.97 Decreased By ▼ -0.04 (-0.5%)
TPLP 21.17 Increased By ▲ 0.22 (1.05%)
TREET 23.06 Decreased By ▼ -0.19 (-0.82%)
TRG 140.40 Increased By ▲ 5.80 (4.31%)
UNITY 23.15 Decreased By ▼ -0.34 (-1.45%)
WAVES 11.51 Increased By ▲ 0.01 (0.09%)
WTL 1.68 Increased By ▲ 0.01 (0.6%)
BR100 4,168 Increased By 17.8 (0.43%)
BR30 16,061 Increased By 231.9 (1.46%)
KSE100 41,489 Increased By 138.3 (0.33%)
KSE30 15,564 Increased By 86.2 (0.56%)
Follow us

July 2022 offered a much-needed breather as Pakistan’s LNG imports halved from a month ago at c. $350 million. Recall that LNG imports for both May and June 2022 crossed $750 million, as the government opted to import spot cargoes at record high prices. There was not much on offer for July 2022 as the authorities failed to receive a single bid for spot cargoes.

Eight cargoes imported in July 2022 were all under the long-term arrangements by the state-owned Pakistan State Oil. The LNG cost for July 2022 averaged $17.4/mmbtu and $17.7/mmbtu for SSGC and SNGPL consumers, respectively, excluding standard GST rate of 17 percent. All 12 cargoes have been secured at the long-term contract arrangements with Qatar, of which five are priced at a slope of 13.3 percent of Brent, and three at 10.2 percent.

Brent averaged $111.5/bbl for the reference period for July 2022 slope calculation – which is based on average Brent prices of three preceding months. This was the highest Brent average since Pakistan started to import LNG from Qatar under the long-term agreement with Slope at 13.37 percent. The Delivered-Ex-Shipp (DES) import cost at $13.65/mmbtu is lower than last month despite higher Brent slope, due to an additional cargo at the reduced slope of 10.2 percent.

This space had highlighted last month that Pakistan’s July LNG import bill may be substantially reduced, largely due to inability to procure cargoes from the spot market. Two consecutive tenders were scrapped as no bidder qualified for July delivery. Peak electricity consumption months of August and September will require more imported gas to keep up with the demand.

But the previous tender had no takers, as bids for July and August, amounting to eight cargoes received no interest from the spot market. Nothing suggests that the situation is easing anytime soon, as Europe braces for load shedding of power for winters, despite more and more LNG vessels moving towards the continent.

Long-term contracts appear a safer bet, although there are no guarantees of ensured supply. Sensing the same, the government has opened bids for five to six years of long-term supply arrangement, for one monthly cargo – for two delivery periods. The tender outlines the pricing mechanism of the Brent linked slope. It will be near impossible to fetch deals as good as 13.3 percent of 10.2 percent on long-term contracts today but will nonetheless add to supply security in uncertain times.

Comments

Comments are closed.

Alice Zhang Aug 12, 2022 09:39am
We can supply soya meal 6000mt/month
thumb_up Recommended (0)