ISLAMABAD: Qatar is expected to divert 24 liquefied natural gas (LNG) cargoes originally contracted for Pakistan to Egypt in 2026, underscoring a sharp decline in Pakistan’s gas demand and a broader reshaping of global LNG trade flows.
According to The Peninsula, QatarEnergy on January 4, 2026, signed an agreement with the Egyptian Natural Gas Holding Company (EGAS) to supply up to 24 LNG cargoes during the summer of 2026. Petroleum sector officials in Pakistan confirmed that these volumes will effectively come from Pakistan’s long-term LNG commitments, diverted under the Net Proceeds Differential (NPD) clause due to a steep fall in domestic gas consumption.
While the memorandum of understanding also signals deeper long-term energy cooperation between Qatar and Egypt, officials said the number of cargoes agreed with Cairo exactly matches the 24 cargoes Pakistan has already consented to divert next year.
Officials in the Petroleum Division said Pakistan’s gas demand has fallen by more than 400 million cubic feet per day, mainly due to sluggish economic activity and high gas prices for export-oriented industries. This has created a substantial surplus under existing LNG supply contracts. “The same number of cargoes that Pakistan is diverting are now being supplied by Qatar to Egypt,” an official said.
Under the Annual Delivery Plan (ADP) for 2026, Pakistan is scheduled to import 88 LNG cargoes from Qatar but divert 24 of them to the international market through the NPD mechanism. Owing to peak winter demand, the government has decided not to divert any cargoes in January and February 2026, with diversions beginning in March and continuing through December.
In January, Pakistan will import 12 LNG cargoes—11 from Qatar and one from Italy’s ENI—to meet winter demand, while February will see eight cargoes from Qatar, again with no diversions. From March onward, the planned diversions of Qatar’s term cargoes include one cargo in March, four in April, two in May, one in June, three in July, two in August, four in September, three in October, three in November and one in December.
Separately, 11 LNG cargoes from ENI—one each month from February to December—will also be diverted under a negotiated arrangement with Pakistan LNG Limited (PLL). In total, 35 LNG cargoes valued at more than $1 billion are expected to be diverted in calendar year 2026, with a further 10 ENI cargoes planned for diversion in 2027.
The financial impact of diversions differs significantly between suppliers. Under Qatar’s NPD clause, any profit from a diverted cargo sold above Pakistan’s term price accrues entirely to Qatar, while any loss is borne by Pakistan State Oil (PSO). In contrast, ENI cargoes are diverted under a negotiated framework with PLL, under which profits and losses are shared—a structure government officials consider more equitable.
The government has made it clear that it will not absorb any losses arising from LNG diversions under the NPD mechanism. Any losses caused by weak international prices will be passed on to RLNG consumers, including RLNG-based power plants, export industries, the CNG sector and domestic RLNG users. Authorities have stressed that neither the federal government nor PSO will shoulder these losses.
Despite the large-scale diversions, Pakistan is still expected to have 13 surplus LNG cargoes in 2026, highlighting the depth of the demand slowdown. Earlier projections had suggested up to 48 surplus cargoes, but successful diversion of 35 shipments is now expected to provide significant financial relief.
Based on an average term price of about $30 million per cargo, Pakistan is projected to save roughly $1.05 billion in foreign exchange. Reduced LNG imports will also allow authorities to restore curtailed supplies of indigenous gas, enabling consumers to access locally produced gas at around Rs1,000 per MMBTU, compared with approximately Rs3,500 per MMBTU for RLNG.
Story by Khalid Mustafa
