Page 10 - GLNG Week 26 2021

GLNG ASIA GLNG

ITFC lends $4.5bn to Pakistan

for oil, gas imports

INVESTMENT THE Pakistani government has reportedly Dawn’s sources said the funds had not been fully
secured a three-year, $4.5bn loan from the used owing to lower international oil prices,
Islamic Trade Finance Corp. (ITFC) to depressed domestic demand and limited sup-
help cover the cost of the country’s energy plies of Arabian crude.
imports. ITFC CEO Hani Salem Sonbol said at the
The parties were expected to sign a formal time that Pakistan was the second largest bene-
framework agreement for the trade financ- ficiary of ITFC financing and that the institution
ing facility this week, local daily Dawn quoted would continue to support Pakistan’s financial
unnamed sources as saying on June 25. The loan needs relating to its oil and gas imports.
will be broken into three annual tranches, each The newspaper’s sources said the interest rate
worth around $1.5bn, that will used to pay for of this new facility would be lower than that of
imports of crude, oil products and liquefied nat- the existing loan – reportedly set at LIBOR+
ural gas (LNG) over 2021-2023. 2.3% – given the “substantial” liquidity surplus
Rather than transferring the funds to Paki- of banks in the United Arab Emirates (UAE) and
stani bank accounts, it is understood that the Saudi Arabia.
loan will be used to underwrite letters of credit The $4.5bn loan agreement is not the first of
(l/cs) for Pak-Arab Refinery (Parco), Pakistan its size between ITFC and Pakistan either, with
State Oil (PSO) and Pakistan LNG Ltd’s (PLL) both parties having signed such a deal April 2018
imports. for the 2018-2020 period. That facility saw the
ITFC is a member of the Islamic Develop- institution extend $386mn to the South Asian
ment Bank (IsDB) and was created in 2008 to country last year.
advance trade among Organisation of Islamic Pakistan reportedly spent $4.5bn on oil
Cooperation (OIC) member countries. product imports in the first 11 months of fiscal
Pakistan had already signed a $1.1bn trade year 2020-2021, as well as $2.5bn on LNG and
financing facility with ITFC in February, but another $2.5bn on crude oil.™

EUROPE

Gazprom starts on CBM-

to-LNG plant in Siberia

PROJECTS & RUSSIA’S Gazprom has started building a small- is comparatively cleaner, although the plant is
COMPANIES scale LNG plant in the country’s coal heartland nowhere near large enough to make a signifi-
of Kemerovo that will use coal-bed methane cant impact on emissions. Kemerovo lacks a gas
(CBM) as its feedstock, Vedomosti reported on network, and so supply cannot be secured from
June 24. The facility will provide fuel for local elsewhere in Russia.
mining equipment, trucks and other energy CBM was first produced in the US in the late
consumers. 1980s and today it accounts for 10% of that coun-
Gazprom will extract the CBM from the try’s gas supply. It is also developed in Australia,
Naryksko-Ostashkinskoye. The plant itself is due Canada and China. But in Russia it has generally
online in the first quarter of 2023 and is sched- not been exploited, given the country’s ample
uled to reach its full capacity of 220,000 tonnes supply of cheaper natural gas.
per year (tpy) by the following year. Exploration However, Russia’s Natural Resources Minis-
at the CBM field began in 2011 and so far 33 well try estimates that CBM production in Kemer-
have been drilled. A system for extracting the gas ovo and the wider Kuzbass coal basin could
was established in February this year, and Gaz- be raised to 4bn cubic metres per year in the
prom plans to drill as many as 110 more wells in medium term and as much as 21 bcm per year
the future. in the long term. This would provide enough
Because of its abundance of coal, the Kemer- gas not only to meet the needs of the Kemer-
ovo relies heavily on that fuel for heating and ovo region but other neighbouring provinces
power, resulting in high levels of pollution. LNG as well.™

P10 www. NEWSBASE .com Week 26 02•July•2021