Shutdown of Engro LNG terminal: Country to face gas crisis from 13th

This process will lead to closure of CNG, cement and non-export industry (general industry and its captive power plants) across the country for three days from September 13-15. However, with the arrival of old FSRU Exquisite, the ramp up process will continue till the midnight of September 15 and the LNG terminal will fully come on stream on September 16 with full regasification of 600mmcfd LNG.

Following the refusal by the Board of Directors to retain the new FSRU Sequoia having storage capacity of 900mmcfd and re-gasification capacity of 780mmcfd mainly because of non-availability of go ahead from NAB, the old FSRU Exquisite that went to Qatar on June 28-29 for dry docking purposes will arrive back on September 13 and will be anchored at the Engro LNG terminal during September 14-15. The gas flow from Sequoia will be reduced on September 13 from 600mmcfd to 250mmcfd, heralding the start of gas loadshedding for three to four days. However for two days, September 14-15, the country will be deprived of 600mmcfd gas.

According to officials in Engro Elengy Terminal Private Company (EETPL), which deals with Engro LNG terminal, Pakistan State Oil and EETPL played a commendable role in arranging the Exquisite laden with LNG, which would reduce 24-30 hours gas loadshedding and lessen the complexities drastically involved in the process of re-deployment of old FSRU. To a question, they said that two days’ time was required to redeploy the old FSRU.

The SNGPL, meanwhile, also issued a memorandum to top officials dealing in north and south areas, which come under its jurisdiction (Punjab and KP), informing that in the wake of shutdown of Energy LNG terminal, there will be suspension of gas flow for three days (September 13-15) to CNG and cement sectors, non-export industry (general industry) in Punjab and KP, the jurisdiction of SNGPL.

However, during the winter’s peak season, there will be a huge gas crisis across the country as the government has failed to take advantage of new FSRU Sequoia by utilising its additional capacity to regasify LNG up to 150mmcfd. The government is also in talks with the management of Pakistan Gas Port Company Limited for utilising an additional capacity of 150mmcfd of the brand new FSRU anchored at the PGPCL LNG terminal. The PGPCL wants to utilise the additional capacity on private to private mode and it has refused to sell additional gas to the Pakistan LNG Limited.

According to sources, talks are heading towards a positive direction. If the private sector is allowed to utilise the additional capacity of PGPCL LNG terminal, it would be tantamount to a paradigm shift in the LNG business as currently the government is handling 100 percent LNG business. And in case a deal is not done with the PGPCL management, then a mammoth gas crisis would grip the whole country and non-export and export industry would also suffer the most.

Additionally, the domestic sector would also suffer in various pockets of the country during the forthcoming days as the local gas production has dwindled to 2.8 bcfd (billion cubic feet gas per day) and the contracted gas import stands at 1.2 bcfd, which means the country would have maximum gas flow of 4 bcfd, whereas the demand in winter season jacks up to 5 bcfd. Had the country’s decision-makers managed to get the additional capacity of 300mmcfd from Sequoia and FSRU at PGCPL, gas management would have been easier in the winter season with some loadshedding to various sectors. The expected massive gas crisis in the winter season may trigger a political backlash for the government.

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