Business
Pakistan purchases costliest LNG shipments to avoid blackouts
Islamabad: Pakistan has purchased an all-time expensive Liquefied Natural Gas (LNG) as country obtained four cargoes for September delivery worth of $15 per million British thermal units— highest since the nation began imports in 2015.
According to people familiar with the matter, the Petroleum Division has opposed capacity enhancement of existing terminals of liquefied natural gas saying it would lead to competition barrier and create private monopoly.
Reportedly, Pakistan’s power generators will be the main consumers of the latest cargoes, without which there was a risk that country wouldn’t have enough electricity.
However, the high costs are also a strain on the budget, with surging energy and commodity prices.
The costliest prices are a blow for Pakistan, which along with other developing nations built LNG import strategies on the premise that the fuel would be abundant and cheap for the foreseeable future.
Meanwhile, the current spot price for Asian LNG is trading roughly 67% above the 10-year average.
While domestic consumers are currently protected from the turbulent imported gas prices, the government in Islamabad is considering changing some of those regulations to pass on some of the added cost.
On the other hand, the energy ministry didn’t respond to a request for comment.