Pakistan has procured liquefied natural gas (LNG) at $15.19-$15.49 per mmBtu for September, which is the most expensive deal since 2015 and it may fuel gas circular debt.
The government has imported four LNG cargoes at the highest ever rates that will be shipped across the country.
The LNG price will increase further by $4 to $5 per mmBtu to reach $19 to $20 per mmBtu after different taxes and surcharges.
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As per details, the government canceled its tender of 8 cargoes for September and October due to high rates that were $13.78 per mmBtu.
LNG’s first cargo will reach Pakistan until September 7 at a rate of $15.397 per mmBtu, while the second cargo will cost around $15.497 per mmBtu and will reach till September 13.
The third shipment will reach Pakistan until September 28 at a rate of $15.397 per mmBtu.
Pakistan was forced to buy priciest LNG shipments amid global supply crunch 🇵🇰🚢
In order to avoid power shortages, Pakistan bought 4 LNG cargoes for Sept. at rates above $15/mmbtu, the highest for the nation since imports began in 2015
W/ @FaseehMangi https://t.co/7jARCF2JfK pic.twitter.com/rxUeGXacSx
— Stephen Stapczynski (@SStapczynski) July 29, 2021
All Pakistan CNG Association (APCNGA)Chairman, Ghiyas Paracha told News360 that LNG is sold to industrial consumers at a rate of $6.5 per mmBtu and is available for the exports sector at $6 per mmBtu.
He added that LNG bought at exorbitant prices will weigh heavy and the government has to bear an additional subsidy of $6.
“The government would have to pay a subsidy of around $13 per mmBtu which would increase the gas circular debt of Pakistan”, he said.
He asserted that the CNG sector in Pakistan is willing to import LNG to minimize the procuring cost but despite several efforts, LNG import for the private sector remained forbidden.