Pakistan aims to revive stalled Qatari LNG project

Pakistan is actively pursuing the revival of a $200 million Qatari investment in a liquefied natural gas (LNG) terminal project that has faced bureaucratic obstacles for half a decade, primarily related to pipeline capacity allocation issues.

Pakistan's local gas production dwindling from 4.2 billion cubic feet per day (bcfd) to 3.19 bcfd and the country has increasingly turned to imported gas (RLNG). However, progress in installing LNG terminals and expanding RLNG pipeline infrastructure has been limited.

As per a report published by The News, the Energas terminal, designed to operate on a business-to-business (BtB) model without government guarantees on RLNG (Re-Gasified Liquefied Natural Gas) takeoff, holds the potential to re-gasify up to 1,000 million cubic feet per day (mmcfd) of LNG.

Energas LNG terminal management recently engaged with petroleum division officials to address long-standing issues, with plans for further discussions. Qatar is set to hold a 49 percent share in the Energas LNG terminal.

Despite high-level discussions and promises to Qatar from Pakistan's leadership, no formal progress has been made in previous government of PTI and PDM, which has led to frustration on both sides.

Pipeline capacity allocation from Sui Southern Gas Company (SSGC) has been secured for the Energas terminal, but approval from Sui Northern Gas Pipelines Limited (SNGPL) remains pending. Delays are further exacerbated by incomplete documentation related to Third Party Access (TPA) and an unfinished network code, both essential for the network's operationalization.

SNGPL argues that it allocated pipeline capacity to Energas during a meeting in October 2021 and provisionally approved the Access Agreement in December 2021. However, Energas has not yet signed the agreement, insisting solely on the Allocation Agreement. The Petroleum Division reported resolving key issues in the Allocation Agreement in November 2022, but as of now, Energas has not signed it.