Pakistan LNG
Pakistan LNG Ltd’s recent import tender for a liquefied natural gas (LNG) cargo to be delivered in January has received bids from four prominent companies: OQ Trading, QatarEnergy Trading, Trafigura, and Vitol. The state-owned entity, responsible for procuring LNG from the global market, issued the tender earlier in the week, specifically targeting a cargo delivery to Port Qasim in Karachi on January 8 and 9.
The bidding companies presented diverse offers, with OQ Trading (formerly Oman Trading International) proposing a cargo at $18.46 per million British thermal units (mmBtu), and Vitol offering a slightly higher bid at $18.58/mmBtu. QatarEnergy Trading and Trafigura quoted $19.43/mmBtu and $19.64/mmBtu, respectively.
Pakistan has been grappling with challenges in its spot LNG purchases, exacerbated by the surge in global prices following Russia’s invasion of Ukraine, which led to record-high LNG prices. This situation has contributed to widespread power outages in the country. In an effort to address energy needs, Pakistan LNG made its first spot purchase in over a year back in October, awarding a tender to commodities trader Vitol for the delivery of a cargo in December.
Natural gas plays a crucial role in Pakistan’s power generation, accounting for more than a third of the country’s energy mix. However, local gas reserves fall short of meeting the escalating demand for electricity. The competitive bidding process for the January LNG cargo reflects the ongoing efforts of Pakistan LNG to navigate the complexities of the global energy market and secure reliable and cost-effective sources of liquefied natural gas to meet the nation’s energy requirements.
