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Pakistan Likely To Witness Gas Deficit After Failing To Procure LNG Cargoes: Report

Pakistan is set to face an unprecedented gas deficit in the coming months due to failure to attract the LNG trading companies in response to its tender floated.


Image: ANI

The Pakistan government seems to have failed to attract the LNG trading companies in response to its tender floated last month. According to the reports of a Pakistan based news organisation, According to The News International, the country would face an unprecedented crisis of Liquefied Natural Gas (LNG) in the coming months as it would not able to import the desired amount of LNG from other countries. According to local media reports, Pakistan will not be able to import 1.2 bcfd (billion cubic feet per day) LNG each in December and January. Instead, the country will be able to import just 900 mmcfd each month with a deficit of 300 mmcfd (million cubic feet per day).

The report said that the Imran Khan-led government floated tender for Liquefied Natural Gas multiple times but failed to garner the attention of any of the trading companies. "This would be a double jeopardy for the government creating a mammoth political backlash from the masses sick of high inflation for a very long time,'' a senior official at the country's Energy Ministry told The News International. "The production of local gas has fallen to 2.8 bcfd and the country can import 1.2 bcfd LNG which will not be fully exploited in the coming winter. In the winters the demand goes up to 5 bfcd whereas the country will only have 3.7 bcfd in December and January for failure in purchasing eight LNG cargoes."

Gas deficit forces the Pakistan government to shut down major factories

Further, the media reports claimed if the Pakistan government could able to convince the LNG trading companies, even then, it would not supply a sufficient amount of energy to the country during the peak season. According to the experts familiar with the latest developments, the intensity of the gas crisis would increase to a level where Imran Khan would not be able to render gas to the power and export sector. "This means that in December and January, the country's economic and industrial activities will virtually come to standstill," the official told to The News International.

According to Pakistan based media outlet, Sindh has already been facing a severe gas crisis and the recent development has added woes to the Imran Khan government. According to Geo News, gas supply to private power plants, including non-export industries has been suspended till last Monday. 

What leads to the shortage of energy:

  • According to BBC, the back to back COVID-19 lockdown has cut down the production as well as transportation capacity of energy-producing industries.  
  • A large amount of energy got wasted in the reopening of the plants as it needs a deep cleaning.
  • Pakistan has fewer gas storage facilities than some countries, leading to the country's export exchequer. 
  • Some reports also alleged Russia behind the ongoing crisis as it is a major gas supplier. 

With inputs from ANI

Image: ANI

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