government

ISLAMABAD: For the month of September, the government has purchased four LNG cargoes at the highest-ever prices of $15.19-$15.49 per mmBtu.

In September and October, the state-owned Pakistan LNG Limited (PLL) canceled eight cargo tenders, stating that the rates were higher at $13.78 per mmBtu, but it has since bought four cargoes at the highest-ever pricing.

The PLL held a closed tender in September and received rates for four LNG cargoes of more than $15 per mmBtu, the highest rate it has ever received since it began buying LNG in 2015.

Three LNG cargoes will be purchased from Gunvor and one from PetroChina by the government.

To avoid electrical load shedding in September, the government is under enormous pressure and is required to purchase cargoes at the highest possible prices.

The first cargo will be delivered to PLL on September 6-7 at a cost of $15.397 per mmBtu, the second on September 12-13 at a cost of $15.497 per mmBtu, and the third on September 17-18 at a cost of $15.397 per mmBtu. On September 27-28, PetroChina will deliver LNG cargo at a price of $15.199 per mmBtu.

Now, the PLL is planning to issue a tender for the months of October and November under the Public Procurement Regulatory Authority (PPRA) rules, fearing that it will receive bids close to $20 per mmBtu, given the current price trend in the international market, and because the LNG suppliers must include the premium under the PPRA rules for holding the rate for 15 days.

According to the government, there is currently an LNG price crunch on the foreign market, and it is impossible to anticipate the LNG price trajectory in the future.

The PLL had previously received bids ranging from $10.2937 to $11.7747 per mmBtu for July cargoes and $10.51 to $10.8312 per mmBtu for August cargoes.

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