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PLL opens tender for 10-year LNG supply
PAKISTAN
STATE-OWNED Pakistan LNG Ltd (PLL) has reportedly invited international LNG traders to bid for a 10-year supply contract to meet gas demand in the power generation and industrial sectors.
Local daily The News quoted unnamed sources as saying this week that the supply con- tract, which would see cargoes delivered to PLL’s Port Qasim terminal on a delivered ex-ship basis, was for two 140,000 cubic metre LNG cargoes per month.
“Since we have a constant rather constantly increasing demand it is better to have a term con- tract,” a source at the petroleum ministry told the newspaper.
“ e 10-year term is with an option of ve years walk-away, which e ectively makes it a ve-year arrangement. PLL used to make spot purchases so far, which is quite erratic.”
In January, PLL received 30 o ers from eight LNG suppliers from a tender for ve cargoes for delivery between March and April, with Gunvor understood to have been selected the winner.
Pakistan is understood to be paying 11.99% of Brent crude prices for LNG supplies from Italian major ENI, 11.62% of Brent for supplies from Swiss trader Gunvor and 13.37% of Brent for cargoes from Qatar.
“We expect this term arrangement to be nalised somewhere in between 11% and 12%, and this slope would remain xed for the entire term,” e News quoted the ministry o cial as saying.
PLL’s CEO, Adnan Gilani, warned earlier this year that the country’s LNG demand could more than triple from nearly 7 million tonnes in 2018 to as much as 30 million tonnes by 2024.
PLL’s two oating storage and regasi cation units (FSRUs) – BW Integrity and Exquisite – have a combined handling capacity of about 9-10 million tonnes per year of LNG and are running at near full capacity. Demand for LNG is rising in the face of stagnant domestic gas production, which edged down 1.51 tcf (42.48 bcm) in nan- cial year 2012-13 to 1.46 tcf (41.35 bcm) in 2017- 18, energy ministry data show.
According to the country’s Oil and Gas Reg- ulatory Authority (OGRA), the power sector consumed 43% of the country’s total available gas in nancial year 2016-17. Rising numbers of residential gas connections, however, means there is insu cient gas supplies, which is creat- ing power shortages. According to one World Bank survey, 66.7% of local businesses perceive power shortages to be a great obstacle to business than corruption, crime or terrorism.™
EMISSIONS
WA consults on emissions guidelines
AUSTRALIA
WESTERN Australia’s Environmental Protec- tion Authority (EPA) launched a 12-week con- sultation programme this week into its carbon emissions guidelines.
The EPA originally released guidelines in March requiring major new resource projects to o set all of their associated carbon emissions. But the immediate backlash from industry – including from LNG developers – as well as from the WA government saw the regulator withdraw the rules shortly a er.
EPA chairman Tom Hatton acknowledged on June 10 that the regulator’s previous provisions had caused confusion and concern and said the 12 weeks of consultation would be thorough.
“It’s a dinkum consultation, so we are abso- lutely open-minded, and we’re looking forward to the information we receive from the commu- nity,” he said.
Local daily The West Australian quoted a Woodside Petroleum spokeswoman as saying the company wanted rules that recognised the global e ect of LNG exports on carbon emis- sions. Hatton said the EPA would consider the industry’s emission argument, adding that if it were not considered, there could be legal
challenges to EPA recommendations. Meanwhile, Australian Energy and Emis- sions Reduction Minister Angus Taylor claimed earlier this month that the country’s LNG exports cut 148 million tonnes of global green- house gas (GHG) emissions in 2018 on account
of displaced coal consumption in Asia.
e Department of Environment and Energy said it had reached the 2018 gure by comparing the emissions from the burning of Australian LNG exports against those generated from an equivalent amount of energy found in black coal. It said: “Under this comparison, the combustion of LNG exports would generate 197.1 million tonnes CO2-e, which is around 148 million tonnes CO2-e less than the emissions generated by the combustion of the same amount of energy
of black coal (345.1 million tonnes CO2-e).” The GHG claims have been disputed by a prominent local climate scientist, Bill Hare, who has 30 years of experience working in cli- mate science. He said: “Government claims that Australia’s LNG exports are reducing emissions globally are grossly exaggerated and, depending on the real level of methane leakages, reservoir
CO2 venting and losses, likely to be wrong.”™
Week 23 13•June•2019 w w w . N E W S B A S E . c o m P7