Pakistan LNG Ltd (PLL) received a bid from commodities trader Trafigura at $23.47 per million British thermal units (mmBtu) for an LNG import tender to be delivered on January 3-4 and at $22.47/mmBtu for delivery February 23-24, a source with knowledge of the matter said on Friday.
In June, Pakistan issued two tenders seeking spot liquefied natural gas (LNG) cargoes for the first time in nearly a year but did not receive any bids.
Pakistan LNG fails to secure cargoes for Oct-Dec: report
The bid from Trafigura is for Pakistan LNG’s second tender which closes on July 14.
Meanwhile, Bloomberg News reported that the shipments offered by Trafigura “are priced at roughly a 30% premium to current market prices, according to traders”.
“Typically, spot purchases of fuel would be sold at similar levels to market prices,” it said.
The report informed that Pakistan will not award the tender until July 31, and it remains to be seen whether the country will follow through with buying the fuel.
“Credit risk had been a barrier stopping LNG suppliers from selling spot shipments to the nation,” said the report.
The development comes days after Pakistan managed to secure a $3 billion Stand-By Arrangement with the International Monetary Fund (IMF).
Dependent on gas for power generation, the country has struggled to procure spot cargoes of LNG after global prices elevated last year following Russia’s invasion of Ukraine.
Pakistan imported 9 billion cubic metres (bcm) of LNG last year, according to Refinitiv data, down nearly 20% from 11.2 bcm in 2021.
The South Asian country has two long-term supply deals with Qatar, one signed in 2016 for 3.75 million metric tons of LNG a year, and another signed in 2021 for 3 million metric tons a year.
It also has an annual portfolio contract with ENI for 0.75 million metric tons a year.