Hurdles in LNG import removed

LAHORE: The Ministry of Petroleum and Natural Resources will be able to import the first consignment of 400MMCF of liquefied natural gas (LNG) by the end of the first quarter of the next year as it has resolved issues with the defence ministry, the Port Qasim Authority and other stakeholders, Dawn has learnt. On a directive of Prime Minister Nawaz Sharif, the ministry had earlier planned to import the LNG and add it to the system (200MMCF each for the Sui Northern Gas Pipelines Limited (SNGPL) and Sui Southern Gas Company) by November this year but objections raised by different departments made it impossible. Major objections included less availability or unavailability of deep sea space at Port Qasim for a huge ship carrying LNG, expected suspension of other ships’ arrival and stay at the port because of lengthy stay of the LNG-carrying ship and environment impact to be caused by re-gasifying highly explosive LNG at the port and adding it to the system. A ministry official told Dawn that all issues had been resolved in a recent confidential meeting in Islamabad but there was no chance of importing LNG by November. Under the contractual obligations, he said, the Elengy Terminal Pakistan Limited, a subsidiary of the Engro Corporation Limited, was bound to construct a special jetty/terminal at the port till March 31 next year. But the company has verbally assured the ministry of completing the terminal’s construction by November or December. “But the ministry cannot pressurise the firm to construct the jetty before the deadline under contractual obligations. So we can safely say that LNG import will be possible by the end of the next year’s first quarter,” the official said. Asked about a delay in issuance of licences to the SNGPL and SSGC by the Oil and Gas Regulatory Authority, which was mandatory for the import of LNG under the law, he said it was a formality. “Ogra has no objection to issuance of the licences. The authorities concerned will soon issue them as the process is underway,” he claimed. The official said that “oil mafia” was behind the objections and other tactics used in delaying the LNG import. “The mafia is very strong in Pakistan and it doesn’t like the idea of LNG import because it will lead to a decline in oil imports,” he said. He said LNG stood at the last column in the list of highly explosive items among oil and gas products. The first is liquefied petroleum gas followed by crude oil, diesel, petrol and then LNG. “When LPG, crude oil, diesel and petrol are already being imported through Port Qasim, why objections are raised to LNG import only. It proves that the oil lobby was trying to stop the government from importing LNG to protect their vested interests,” the official said. After having failed to stop LNG import, the lobby was now getting objections raised to the import price of LNG through various people. “But such efforts will also fail as we have invited tenders, calling every interested party at home and abroad, to participate in the process and submit their rates. We will accept the minimum price we are offered,” he said. Published in Dawn, June 2nd, 2014