ISLAMABAD: The Qatargas authorities have linked the signing of Liquefied Natural Gas (LNG) Sales Purchase Agreement (SPA) to the construction of required channel at Port Qasim Authority (PQA), officials said. Officials of the Petroleum Ministry told Business Recorder here on Wednesday that recently a high-level delegation of Qatargas visited Pakistan and held meetings with the relevant quarters. "We are expecting that in the start of June 2015 Pakistan and Qatar will sign a long-term LNG SPA on government to government basis of 400 Million Cubic Feet per Day (MMCFD)," the officials added.
Sources said that so far PQA has failed in satisfying and clarifying the Qatargas Company officials on the depth of LNG channel but during the recent meeting PQA officials assured the company that by the end of ongoing month PQA will carry out all the necessary developments required for the channel. They said that the channel's depth should be 14 meters but PQA has a 13-meters-deep channel.
The Qatari delegation has shown serious reservations over the failure of PQA of making proper arrangements for LNG cargo handling, the officials said and added that within the next week another Qatari delegation will visit the facility to inspect the arrangements.
Sources added that the PQA has also not signed an agreement with Qatargas for the berthing of LNG cargo ships. The minister, however, pointed out that there were capacity issues pertaining to LNG import through Port Qasim, saying that the port authority should address the issues and develop the capacity. "The Ministry of Petroleum is even ready to give funds for developing the capacity."
Sources said that besides PQA's failure in developing the required channel depth for LNG cargoes, the deal is also not been finalised, as the Ministry of Water and Power failed to persuade furnace oil-based Independent Power Plants (IPPs) to open letters of credit (LCs) and establish a payment mechanism for the commodity suppliers. The Petroleum Ministry's responsibility was to negotiate rates and terms for LNG import and provide gas to Ministry of Water and Power for replacing furnace oil in power production. Sources also said that as per plan of the government, power sector was to use the imported LNG but private power plants did not open any Letter of Credit (LC) accounts as the power sector also linked to purchase of LNG to certain conditions.
Sources said the PQA authorities are have quoted a rate for each cargo ship of LNG at the rate of $1.2 million which is too high as compared to international standards as in Nigeria it costs $0.75 million, in Qatar 0.125 million and in India 0.12 million. Engro Corporation's subsidiary Engro Elengy Terminal Limited (ETPL) has completed an LNG terminal at Port Qasim at the cost of $135 million.
THURSDAY MAY 28: PPRA not consulted on import of LNG: MD
ISLAMABAD: Public Procurement Regulatory Authority was not consulted by the government on import of LNG from Qatar and the authority's management also showed least interest in the matter. Managing Director PPRA Nazrat Bashir said this on Wednesday during a briefing to the members of Senate Standing Committee on Cabinet Secretariat. Chairman of the committee Senator Muhammad Talha Mehmood said that the PPRA is an important institution and it should play its role in keeping the LNG import transparent, besides keeping an eye on China-Pakistan Economic Corridor.
"The PPRA must ensure that all deals both national and international are made in a transparent way, as billions of rupees of taxpayers are being spent on these projects," he said. Bashir said that his organisation has received some 74,000 complaints of irregularities and embezzlement and all of them have been referred to National Accountability Bureau and Federal Investigation Agency for probes into matters. "We don't have legal powers to initiate probes into alleged mismanagement and irregularities," he said.
Chairman committee scolded Managing Director Baitul Maal for spending over 38 percent of the total budget of two billion rupees under different heads of the organisation. "Baitul Maal should be shut down if it cannot provide relief to needy patients and other deserving persons," he said. The committee members have sought details of all expenditures made by the Baitulmal management, especially the amount given to the needy and deserving persons.
Secretary Aviation Division Imran Gardezi informed the committee members that 85 percent of the work on New Islamabad Airport has been completed and it would be operational by the end of next year. Expansion and renovation work of Benazir Bhutto International Airport is complete while the prime minister has also inaugurated work on Multan Airport, he said.
Senator Muhammad Yousaf Badini, however, staged a walkout from the meeting in protest against inordinate delay of flights from Quetta International Airport. He said that neither passengers are given air tickets on time nor do the flights observe the announced schedule while empty aircrafts keep travelling between Islamabad and Quetta.
Talking about K-Electric, Senator Shahi Syed said that some political parties were also involved in theft of electricity in the metropolitan and a cogent policy needs to be devised to cope with the problem. Managing Director National Electric Power Regulatory Authority, Tariq Khattak informed the committee members that the government has given a relief of up to Rs 58 billion till July to all electricity consumers. He also said that the government has not renewed a contract of 650 megawatts electricity with the K-Electric. Some questions raised by Senator Saeed Ghani about Civil Aviation Authority, Airport Security Force and Pakistan International Airline have been deferred till next meeting of the committee.
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