LNG suppliers' participation in bidding: Abbasi seeks help of fellow ministers, political parties

Minister for Petroleum and Natural Resources, Shahid Khaqan Abbasi has sought a help from fellow ministers and other political parties in Parliament to request participation of Liquefied Natural Gas (LNG) suppliers in the bidding at competitive prices.
The minister has expressed these views in a letter written to the ministers and parliamentary leaders of different political parties.
Abbasi is facing criticism for allegedly finalising LNG import deal with Qatar at a price higher than existing deals between Qatar and other countries.
According to the letter, the Ministry of Petroleum & Natural Resources is implementing a major project for the import of LNG based on an unbundled approach. Under this structure, the LNG re-gasification terminal and LNG procurement have been segregated to achieve the lowest possible cost of imported natural gas and help alleviate the energy crisis which has seriously impacted on the country's economic growth.
The Sui Southern Gas Company Limited (SSGCL) followed a fully transparent PPRA compliant process to select the LNG terminal services provider and an LNG Services Agreement (LSA) was executed with Elengy Terminal Private Limited (ETPL) on 30 April, 2014, for the provision of LNG receiving, storage and re-gasification services under a tolling fee at internationally competitive prices. The construction work on the terminal has started and the completion of the work is expected before the end of the year. No public sector funds are being spent on this project and this is the first success in the LNG based natural gas import process after at least five stalled attempts over the last eight years.
The Minister for Petroleum claimed that the LNG procurement is being pursued through a two-pronged approach - government to government negotiations with the State of Qatar and a competitive bid process. Pakistan State Oil Company Limited (PSO) and Qatar Gas Operating Company Limited (QGOCL) have been nominated by the Pakistan and Qatar governments respectively to negotiate the Heads of Agreement (HOA) for LNG supply and negotiations are in progress.
"LNG price will be negotiated after finalising operational and commercial terms, and a high level committee for price negotiations has been formulated," he added.
In parallel, a competitive bid process for the import of LNG has been initiated and advertisements for an Expression of Interest placed in the national and international press on 30 May, 2014. "I am confident that this approach to LNG procurement will provide Pakistan with an assured supply of LNG at the most competitive prices," the minister maintained.