Optimal use of LNG capacity at terminal-II: Ogra policy opposed by SNGPL

ISLAMABAD: The Oil and Gas Regulatory Authority (OGRA)’s promotion of gas liberalisation by engaging the private sector to avail additional LNG capacity at terminal-II is constantly opposed by the Sui Northern Gas Pipeline Limited (SNGPL).

Since the TPA Rules-2012 for gas code for private sector import were in suspension and revised TPA rules were not notified at that time, the matter was deferred till notification of revised third-party access rules.

One of the four private sector LNG marketing companies having provisional licences from the OGRA, Universal Gas Distribution Company (Private) Limited, has repeatedly approached the SNGPL for access arrangement after notification of TPA Rules, in order to import LNG cargo for onward sale to the CNG consumers.

Initial Access Agreement between UGDCL and SNGPL was submitted to board of directors (BoDs) in its meeting held on March 16, 2018.

Upon notification of TPA Rules, 2018, the draft access agreement has been made part of TPA rules.

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In a recent Senate Standing Committee on Petroleum meeting, acting managing director Pakistan LNG Ltd said that the capacity of terminal-II was underutilised except for July-October 2021 when utilisation was between 100 to 104 per cent.

The average utilisation of terminal capacity in 2021-22 was 84 per cent against 83 per cent in 2020-21 and in 2019-20 it was only 52 per cent.

Terminal-I is operating at almost 100 per cent of its contracted capacity, whereas, across the globe they are always setup to cater for peak requirements and are not intended to run 100 per cent at all. The utilisation rate of the global LNG receiving terminals is around 40 per cent.

Copyright Business Recorder, 2022