ISLAMABAD: The natural gas shortage is likely to persist this winter like last year, Minister of State for Petroleum Musadik Malik warned on Wednesday.
It is worth mentioning that PLM-N led coalition government failed to secure LNG contract as Pakistan LNG Limited (PLL) did not receive a single bid from international suppliers for the purchase of Liquefied Natural Gas (LNG) in a tender that expired on Monday, October 3.
Musadik Malik blamed the Imran Khan’s government for failing to contract the cheapest available liquefied natural gas in its tenure.
However, he added that a reliable gas load management system was being developed to guarantee the availability of LPG cylinders as a substitute fuel.
Following a meeting presided over by Finance Minister Ishaq Dar, Mr. Malik said all public sector organizations in the oil and gas sector had been urged to make arrangements for LPG supplies.
The conference was also attended by the secretaries of finance and petroleum, as well as the prime minister’s adviser and head of the energy task force, Shahid Khaqan Abbasi.
According to reports, Mr. Abbasi and Mr. Malik requested the help of the finance minister to simplify the foreign exchange requirements for LPG imports.
The sources claimed that due to the absence of two to three LNG cargoes that were typically available through spot auctions last year, gas curtailments for residential, the power sector, and industry will be higher this winter than they were last.
On Monday, after a month-long deadline extension, the state-run Pakistan LNG Limited (PLL) published the results of two auctions for a total of 72 LNG cargos and stated it had not received any bids. Initially, the PLL floated a tender for 72 cargos, or one cargo every month. One tender was to be issued for two lots, one for the first year (January 2023 to December 2023) and the other for the second five-year period (January 2024 to December 2028).
PLL originally issued an invitation for bids in August for 72 LNG cargoes to be delivered over a six-year term from foreign suppliers.
According to PLL, bids were requested from reputable organizations to convey cargo on a Delivered Ex-Ship basis (DES) at Port Qasim, Karachi, and suppliers had until September 14 to submit their offers.
It stated that bid documents would be accessible from August 10 to September 13, 2022.
The Pakistani procurement, which had an expiration date of October 3, saw no suppliers participate, according to PLL bid documents.
According to the documents, the corporation was looking for one shipment each month for the six-year period.
PLL was required by the Pakistani government to carry out the business of importing, buying, storing, supplying, distributing, transporting, transmitting, processing, measuring, metering, and selling natural gas, LNG, and re-gasified LNG. Each cargo was to have a volumetric quantity of 140,000m3, it added.
For the timeframe of July through September, PLL sought worldwide suppliers to submit proposals for 10 LNG cargoes.
By July 7, suppliers were invited to submit their bids. Each cargo was required to have a volumetric quantity of 140,000m3, according to PLL documentation.
Bloomberg, citing traders with knowledge of the situation, said that the state-owned LNG purchaser did not receive any bids in a $1 billion LNG purchase tender at the time. The article at the time stated that “it highlights both the scope of the worldwide fuel shortage as well as the unwillingness of suppliers to sell to a country in the depths of an economic crisis.”
