Pakistan has to face a gas shortage in the winter every year. This time around, our dear friend Qatar sent the supplies in time to fight the gas crisis. Pakistan officially thanked them for ensuring the supplies were in time and to avoid the shortage.
Qatar: Low production cost
Qatar has the lowest production cost due to easy access to gas reserves and an easy extraction process. Their increasing capacity makes them the leading LNG supplier. They are expanding their supplies by providing discounts to the buyers for additional capacity. They have also signed deals by offering a 22% lower price.
Long Term Contract with Pakistan
Qatar has long-term LNG contracts, selling the second most LNG volume to Pakistan. Last year, Pakistan signed a 10-year LNG agreement with Qatar. The supplies started in November 2021. Pakistan will get 3 million tons of LNG per year from January 2022. As part of the agreement, Qatar can use Pakistani Terminals to supply LNG to the Central Asian states. It will help Qatar with new clients and Pakistan with building infrastructure.
Competition Commission of Pakistan cleared Qatar Energy’s bid in November 2021. They succeeded in getting 49% of the shares in LNG Terminal at Port Qasim. This is the first direct investment of Qatar in Pakistan’s energy market. The Qasim Terminal Holding LLC, a subsidiary of Qatar Energy already has two long-term LNG contracts with Pakistan State Oil (PSO).
Hammad Azhar, Minister for Energy, thanked Qatar for sending supplies amidst the shortage in the international market. During the virtual meeting with his counterpart Saad Sherida Al-Kaabi, he discussed the areas of cooperation, to promote the existing ties, especially in the energy sector. Qatar is setting up an LNG Terminal in partnership with leading Pakistani companies in the sector. The public sector supports this decision and will back them up as well. He also said that this project will be one of the most important breakthroughs in Pakistan’s energy security and Financial Investment Decision FID will also be finalized soon.
Good Job Mr. Hammad Azhar!
10. #Pakistan & #Qatar agreed to further promote their bilateral cooperation especially in #energy sector.
He welcomed decision of #QatarEnergy to invest in setting up #LNG terminal in partnership with a consortium of leading #Pakistani companies.#Islamabad #Tuesdayvibe pic.twitter.com/MOmBhsDq50
— Pakistan Corporate Updates (@pakco_updates) January 18, 2022