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SIFC directs Petroleum Division to remove hurdles in Qatar’s LNG terminal investment

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11 months ago

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  • Petroleum Division has been asked to resolve all issues so that investment from Qatar could be ensured, says official.
  • PD asked to resolve all issues to make way for Qatari investment.
  • Investment has been pending for last five years due to red-tapism.
  • Petroleum Division secretary personally trying to resolve all issues.

ISLAMABAD: The Special Investment Facilitation Council (SIFC) has directed the Petroleum Division to remove hurdles in the $200 million Qatari investment in an LNG terminal, reported The News on Friday citing sources.

“Energas plans to establish the LNG terminal with Regas capacity of 750-1,000 MMCFD having a shareholding of 49% of Qatar Gas and 51% of Energas. To be erected on BtB model, the investment from Qatar has been stalled for the last five years due to bureaucratic red-tapism,” an official, who spoke on the condition of anonymity told the publication.

Qatar raised the issue during the Pakistan Tehreek-e-Insaf (PTI) and Pakistan Democratic Movement multiple times but no progress could be made on OGRA network code, tax holiday, TPA exemption, SNGPL GTA (gas transmission agreement).

“This time SIFC has taken up this issue with the intervention of top military leadership and directed the mandarins of the Petroleum Division to resolve all the issues and report back so that the investment from Qatar could be ensured.”

A senior official told the publication that following the SIFC’s intervention the Petroleum Division secretary is personally looking into the issue and trying to resolve all issues.

The Energas Terminal, which is to be operated without any government guarantee on RLNG takeoff, will have the capacity to re-gasify up to 1,000 million cubic feet per day (mmcfd) of LNG.

However, Qatar is not the only one interested in LNG projects. Pakistan Port Gas Limited’s LNG Terminal-2 and Tabeer LNG Terminal owned by Japan’s Mitsubishi have been in the pipeline for a long time.

The projects were supposed to become operational in 2021 on a BtB model but are yet to take off because of red tape.

“The ministry is working on the issue as the government wants more LNG terminals on BtB model,” said Energy Minister Muhammad Ali told The News.

According to Energy Ministry officials, the Petroleum Division has wasted five years to install LNG terminals. At the same time, it could not lay another RLNG pipeline from Karachi to Lahore (North-South or Pakistan Gas Stream Pipeline).

Both the PTI and PDM governments failed to develop infrastructure to support the import of RLNG. Under the existing scenario, the government has signed contracts with the existing two LNG terminals — Pakistan Gas Port Limited Terminal (PGPL) and Engro Elengy Terminal (Private) Limited (EETL) with sovereign guarantees against the import of 1.2 bcfd at the maximum.

However, if Pakistan’s wishes to import more RLNG then it would need more terminals and a pipeline.

The Sui Southern Gas Company (SSGC) board has allocated pipeline capacity to the Energas Terminal and signed GTA, the official said. However, the approval for pipeline capacity from the Sui Northern Gas Pipelines Limited (SNGPL) board is still pending and consequently, the GTA could not be signed.

Furthermore, the official said incomplete documentation of the Third Party Access (TPA) associated with the Oil and Gas Regulatory Authority is also causing delays. The interim pipeline capacity has become necessary due to the incomplete OGRA-TPA documents.

“The network code, which is crucial for operationalising the network, also remains incomplete, with no progress towards its finalisation.”

When contacted, the SNGPL said the ECC in its Oct 27, 2021 meeting allocated pipeline capacity to Energas on the SNGPL network.

The gas supplier added that its Board of Directors in December 2021 accorded in-principle approval for the execution of Access Agreement with Energas and it was incorrect to lay the blame on them.

The SNGPL, after BOD’s approval, shared the final draft of the Access Agreement with Energas in January, 2022 and again in August, 2022 for their signatures. The Energas, however, did not sign the document and insisted on signing the Allocation Agreement only.

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It is anticipated that 150 ships would arrive at Gwadar by the year 2045, allowing the port to handle fifty percent of all imports.

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3 days ago

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In an effort to strengthen the port’s economic importance, the Federal Government has made the decision to direct fifty percent of all imports from the public sector to Gwadar Port.

By taking this action, which has the backing of the Special Investment Facilitation Council, the port’s financial situation is going to be improved.

The Cabinet will be presented with a summary of imports through Gwadar by the Ministry of Maritime Affairs, which will take place after Prime Minister Shehbaz Sharif’s recent trip to China.

When the next Cabinet Meeting takes place, Ahsan Iqbal, the Federal Minister for Planning, Development, and Special Initiatives, will examine the Chinese offer for the Karachi to Hyderabad Section of the ML-1 Project and bring it to the Cabinet.

Company preparations for the Shanghai International Import Expo, which will take place in November 2024, are being made by the Board of Investment and the Ministry of Commerce of Pakistan.

One of the most important aspects of the China-Pakistan Economic Corridor is the Gwadar port, which serves as a significant commerce route connecting China, the Middle East, Africa, and Europe. At this time, the Gwadar Port is able to accommodate two huge ships, and by the year 2045, it is anticipated that it would be able to handle up to 150 ships.

By developing the Gwadar Port, regional connectivity would be improved, employment will be created, and international investment will be attracted.

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The price of gold in Pakistan has experienced a significant surge.

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3 days ago

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Gold prices in Pakistan surged significantly on Thursday following two consecutive days of decline, with the price per tola rising by Rs2,000 to reach Rs262,100. This increase was in accordance with the downward trend in international market values.

The All-Pakistan Gems and Jewellers Sarafa Association (APGJSA) reported that the price of 10 grams of 24-karat gold rose by Rs1,714, reaching Rs224,708.

Conversely, the world gold market experienced an upward trajectory. According to the APGJSA, the global price of gold surged to $2,503 per ounce following a $22 gain during the trading session.

The local market experienced a significant decline in silver prices, decreasing from Rs50 to Rs2,900 per tola after a prolonged period.

The local market’s gold prices remain subject to the ever-changing dynamics of the international market, as well as domestic considerations such as currency exchange rates and domestic demand.

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The government has not met the deadline set by the International Monetary Fund (IMF) for the approval of a $7 billion loan.

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4 days ago

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On Tuesday night, there were virtual talks between representatives of the Finance Ministry and the IMF delegation, with the main topics being external finance and income generation.

According to people familiar with the situation, no date has been set for the IMF’s Executive Board to approve the loan despite the ongoing negotiations.

Officials from the Finance Ministry informed the IMF mission about the government’s initiatives to get outside funding during the discussions. Updates on loan rollovers and fresh finance commitments from allies were included in this. According to sources, the IMF has received a schedule, and loan rollovers are expected to be finished by the end of next week.

The $12 billion in debt must be rolled over before the loan can be approved by the Executive Board, according to the IMF mission.

In the virtual discussions, representatives of the Federal Board of Revenue (FBR) conversed with the IMF team over the revenue deficit. The FBR must reach its revenue goals for this month, according to the IMF mission. As a result, the IMF has asked the FBR to submit a thorough strategy outlining how it will close the gap left by the shortfall and guarantee that revenue goals are reached.

Apart from the conversations on outside funding, there are rumors that the Finance Ministry is actively holding talks with commercial banks in order to obtain new funding. According to reports, negotiations are taking place with four distinct sources for commercial loans, which are anticipated to support the government’s overall financial plan.

Finance Minister Muhammad Aurangzeb disclosed on Tuesday that the IMF was in favor of introducing targeted subsidies. He said that qualifying recipients might receive these subsidies through the Benazir Income Support Programme (BISP).

In order to guarantee consistency, the minister announced that this week’s talks with chief ministers will focus on implementing a similar policy across the country. He was having a casual conversation in parliament with the journalists.

In response to queries about outside funding, Aurangzeb revealed a $2 billion deficit and said that talks to close this gap are progressing. He stressed how crucial it is to obtain business loans.

He went on, “At this point, there’s a need to secure an agreement for commercial loans, not exactly their issuance,” emphasizing that debt rollover negotiations are nearing their conclusion and doing well. The minister expected that these developments would shortly be reported to the governments of allied countries by relevant authorities.

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