KARACHI: Engro Elengy’s floating storage re-gasification unit (FSRU) Exquisite has brought in the 5th load of liquefied natural gas (LNG) procured by Pakistan State Oil (PSO) from the open market.
Sources at PSO said the government had not been able to sign a regular procurement deal so far and the state oil company was procuring the commodity from the open market to maintain additional 200 mmcfd supply into the system.
Without disclosing the value of the consignment, sources at Port Qasim informed that the value of the consignment, as per the declaration of the importer was the same as the previous consignments. The consignment containing 63,000 tons of LNG attracted duty taxes at the rate of $440 per ton. However, the importer is in process to get this reduced to $30 per ton.
It may be mentioned here that the FSRU Exquisite, was to remain anchored at Elengy’s terminal, while other carriers had to refill the floating terminal.
Sources said that since no regular procurement and supply agreement has been finalised on government level, Elengy’s floating terminal has to lift the cargo from Qatar.
Meanwhile, PSO has received five bids in response to its tender for the supply of LNG, sources said, adding that three foreign suppliers and two local suppliers expressed interest in providing the commodity.
An official at PSO said the process would be completed by June end and the LNG supply agreement would be signed with the successful bidder thereafter.
Pakistan heavily relies on its import of furnace oil and diesel to fuel power stations, and both fuels are relatively expensive as compared to LNG, which is cheaper and a more efficient alternative. LNG is also cleaner and considered environment-friendly. Re-gasification of LNG will allow generation facilities to reach their maximum potential, using a cleaner and more efficient fuel, and will support the country’s push for greater energy security and diversification.
The converted fuel will help the government make an estimated savings of about $1.0 billion per annum on its current fuel import bill of nearly $15 billion.