Saturday Nov 06, 2021
ISLAMABAD: The Pakistan LNG Limited (PLL) Friday received five expensive bids for emergency LNG cargoes to avert the looming gas crisis in the country.
According to the details PLL received bids with higher prices ranging from $29.8966 to $31.0566 per MMBTU from international LNG trading companies for two spot LNG cargoes to be delivered in the last 11 days of the current month.
The country got the lowest bid for November 19-20 from Vitol Bahrain at $29.8966 per MMBTU and for November 26-27 from Qatar Petroleum Trading at $30.6500 per MMBTU.
The PLL board held a meeting, which lasted for hours, to decide if it was to purchase the LNG cargoes at the lowest bids, which are factually at a higher trajectory in terms of prices. The PLL top management, under direction from the Petroleum Division, is tight-lipped and not ready to share the decision.
However, industrial sources say that PLL has decided to procure one LNG cargo from Qatar Petroleum Trading at $30.65 per MMBTU to be delivered on November 26-27 for some reasons that have not been shared. With the purchase of one LNG cargo, the basket sale price in the country would be at $15 per MMBTU.
The state-owned company, PLL issued an emergency tender on November 2, seeking bids for spot cargoes in the wake of backing out by two LNG trading companies, ENI and GUNVOR, to provide two LNG term cargoes, which were due to be delivered on November 19-20 and November 26-27.
Both the LNG trading companies sold Pakistan’s term cargoes in the spot market for a massive windfall profit of 200% and showed a willingness to face a penalty, which is just 30% of the term cargo price. This has put the authorities in Pakistan in the lurch, forcing the government to issue an emergency tender on November 2, 2021, knowing the fact that the country will get the highest prices.
The government had the plan to import 11 LNG cargoes for November, but after the cancellation of two cargoes by ENI and GUNVOR, nine cargoes are left to be delivered in the whole month of November, which are not enough to cater to the country's gas needs in the current month. So the government issued the emergency tender asking for two LNG spot cargoes.
In response to the emergency tender PLL issued on November 2, 2021, five bids were received from three companies that include Vitol Bahrain, QP Trading and Total Energies & Power which were declared technically qualified.
Vitol Bahrain submitted two bids for LNG cargoes; first with a price at $29.8966 per MMBTU to be delivered on November 19-20 and second at $31.0566 to be unloaded on the PGPCL terminal in Port Qasim on November 26-27.
However, Qatar Petroleum (QP) Trading also submitted two bids; one with a price at $30.05 per MMBTU for November 19-20 and another one at a price of $30.65 per MMBTU to be delivered on November 26-27. Total Energies & Power came up with only one bid for November 26-27 at a price of $30.96 per MMBTU.
Originally published in The News