A high-level Indian delegation is expected to visit Pakistan within a week to finalise a deal on sale of 200 mmcfd of Liquefied Natural Gas (LNG) to Pakistan, officials said. According to Petroleum Ministry sources, all modalities other than price of the commodity have been finalised between the two countries.
Talks were held in March and April 2014 in New Delhi during which it was decided that the next round of talks would be held in Islamabad and Pakistan is all set to host officials from GAIL (India) Limited, the largest state-owned natural gas processing and distribution company in India, in the second week of August.
In recent months Pakistan has intensified the process to initiate the import of LNG for which a LNG terminal is under construction at Port Qasim Karachi with a capacity to handle up to 600 mmcfd of the commodity and the government is also going to initiate construction of another LNG terminal at Gwadar port with a capacity to handle up to 1 Billion Cubic Feet per Day (BCFD) of the commodity.
It is hoped that the dispute on price would be resolved between India and Pakistan and the import of LNG from India would start within 9 months via Wagha Border "Both sides discussed term sheets, commodity prices, building of infrastructure and other necessary actions required to be taken for import of LNG from India," the Petroleum Ministry official stated.
"Pakistan initially wanted to import 200 mmcfd of LNG, however no agreement has been reached on price. India is importing LNG at $13 and $14 per Million British Thermal Units (mmbtu), and has offered Pakistan at $21 per mmbtu after including customs or import duty, pipeline transportation charges and local taxes," the official added. Although Pakistan currently does not have an LNG import facility, it is willing to buy LNG from GAIL provided India exempts it from taxes to bring down the cost, they maintained.