LAHORE: The government on Monday directed scaling down of Liquefied Natural Gas (LNG) from both specialised import terminals due to falling fuel demand, reported a private news outlet.
According to a senior official of the Petroleum Division, Pakistan State Oil (PSO) and Pakistan LNG Ltd (PLL) have been directed to reduce their supplies by 17 per cent (from 600mmcfd to 500mmcfd) and one-third (from 300mmcfd to 200mmcfd) respectively, due to drop in gas demand as temperatures increase. The said adjustments in the LNG supplies have been made on the directives of the prime minister.
The three LNG projects were required to achieve commercial operation date (COD) by December 2017, but have been unable to do so till now. However, one of the projects is expected to achieve this stage on March 7.
The increase in the supply was based on demand from power plants.The sector has been giving demands of up to 900mmcfd whereas its actual consumption is around 500mmcfd.
Similarly, federal government’s Haveli Bahadar Shah and Balloki power projects and Punjab governments Qaid-i-Azam Power Plant were to get a firm supply of RLNG from December/January for combined cycle testing but due to repeated technical failures have been unable to scale up supplies.
The plants were to start single cycle operation a year ago, and the two LNG terminals were put in place for this purpose. In case of non-consumption of RLNG, the plants were supposed to make ‘take or pay’ payments, but this was not implemented under orders from the PM Office to avoid a Nandipur like cost escalation situation. The cost has hence being shifted to PSO, LNG companies, Sui gas companies and the consumer at large.
