The Global Energy Holding Limited (GEH), supported by Punjab government, is negotiating for import of LNG with the federal government, Business Recorder has learnt. GEH trading portfolio currently consists of oil, oil products, natural gas, LNG, and electricity. GEH group companies currently operate in Dubai, Istanbul, London, Luxemburg, and Switzerland, and plan to expand to other countries/regions.
It is currently negotiating with Sui Southern Gas Company (SSGC) and Sui Northern Gas Pipeline (SNGPL) in a possible joint venture with Mansha Group for supply of gas through their systems. The GEH plans to provide LNG equal to 500 mmcfd in the first phase. In its presentation, GEH said that it had a fast track solution to resolving the country's gas crisis by end-2011 that would cause annual savings of more than one billion dollars against HFO; and over $2.4 billion against high speed diesel (HSD), based on 2010 prices.
"We are ready and willing to increase our capacity and supply to deliver all the required gas to Punjab and other provinces at the same speed of pipeline construction and will provide secure long-term supply," GEH stated, adding that uninterrupted and continuous gas supply would enhance power generation efficiency.
Compared to HFO and HSD, turbine life of units will extend up to ten years longer and fuel supply logistics will be eliminated. "More environment-friendly fuel is consumed compared to oil and due to higher calorific value (99 percent methane component) of LNG, dispatching authorities (Sui companies) will have a chance to adjust the energy level of gas within all the grid system," GEH presentation added. This will bring stability of quality and better Wobbe index will add further efficiency and decrease maintenance requirements. A meeting was held in the Chief Minister's office in Lahore on December 13, 2010. It was also attended by former Petroleum Minister Naveed Qamar to discuss the proposed LNG import project.
During that meeting it was decided that: (i) the terminal will be set up by the private sector and terminal company will take the imported LNG on behalf of the importer, re-gasify it and supply to the SSGC pipelines for onward swap of gas with SNGPL and transportation at an agreed charge; (ii) a private sector consortium consisting of large gas users--power, fertilizer or other large industrial units--will be mobilised by the government of Punjab to become the importer of LNG. This consortium could include a small stake by the government of Punjab, if needed. SNGPL or the LNG supplier could be invited to take a small equity stake in the consortium, if deemed appropriate. However, it would be led by the private sector and would, therefore, not be required to follow government procurement rules; and (iii) the federal government will ensure that whatever gas is freed up from the system on account of this import would be diverted to other users in the SNGPL system based on a priority agreed with government of Punjab.