ISLAMABAD: Owing to the lack of liquefied natural gas (LNG) import by the Pakistan LNG Limited (PLL), the national exchequer had to bear a loss of approximately Rs12 billion in six months, it was learnt on Friday.
Sources in the power division informed that an ‘influential furnace oil lobby’ has been holding sway over the entire power division, as PLL failed to bring the agreed number of LNG cargos to the country during the last six months, causing around Rs12 billion loss to the national exchequer.
They said that PLL was to import six cargos of LNG to the country in October but it has so far only managed to bring two cargos, causing a monthly loss of over Rs2 billion.
Although the LNG terminal of Pakistan Gas Port Consortium (PGPC) will remain less utilized due to the lack of LNG import, however, an additional payment of Rs620 million will be made to PGPC regardless, sources claimed.
“Owing to the reduced import of LNG, imports from international oil market and production of furnace oil through local refineries has started again, which will further increase the power sector’s circular debt while per unit power price will also increase by Rs3.65,” the sources warned. “Gas consumers of the country might face adverse circumstances in winters due to lower LNG import.”
They noted that PLL has been importing LNG from the international market at a low price, while Pakistan State Oil (PSO) purchases it from Qatar at a higher price.
It is pertinent to mention that the Oil and Gas Regulatory Authority (OGRA) had approved $12 and 73 cents per MMBTU as a price of LNG imported from Qatar for October while PLL arranged LNG from international market at a low price of $11 and 93 cents/MMBTU.
Sources said that the national exchequer will lose around Rs3 billion in the next three months owing to poor LNG policy of former prime minister Shahid Khaqqan Abbasi, adding that PGPC’s terminal will be receiving almost Rs620 million in October despite not being properly used.
OGRA had imposed a Rs560 million penalty on PLL and other government officials on May 4 for failure in LNG import.
However, former PM Abbasi got an approval from the federal cabinet’s economic coordination committee (ECC) to pass on the amount of monthly penalty to the poor gas consumers.
The ECC directed OGRA to pass on the amount of penalty to gas consumers. OGRA withdrew its decision in this regard on May 25 and approved to charge the poor gas consumers.
