ExxonMobil to help build LNG terminal in Pakistan

Since the brand new terminal will be built with no monetary commitments from the authorities the building of the third terminal at Port Qasim will place some pressure on the terminal operators.

Before, ExxonMobil, the world’s largest publicly traded oil and gas firm, had inked an agreement with Universal Gas Distribution Organization (UGDC) — an association of CNG station owners and operators -for LNG supply. Build the terminal and also the company will have to pay a charge of $10 million.

Any terminal that is upcoming will have to fulfill these requirements. The consortium, which also contains Halmore, plans to create the terminal in collaboration. ExxonMobil, in collaboration with the exploration and production businesses of Pakistan, drilled an offshore well for hydrocarbon reserves in the Arabian Sea to hunt. On the other hand, the attempt could not prove successful.

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Of the five curious businesses, just two — Energas and Tabeer Energy (Mitsubishi) — submitted applications on Friday, seeking Letter of Intent (LOI) in the Port Qasim Authority (PQA) for building the third LNG terminal. Energas has been operating with ExxonMobil in Pakistan and is a buyers’ consortium together with LNG need from independent power producers (IPPs), fabric, cement, and auto manufacturing plants. The company has also obtained land and has a valid license from the Oil and Gas Regulatory Authority (Ogra). It has conducted polls and has a performance bond. Therefore, the company is working with all the LNG Policy 2011 on the LNG terminal in compliance. However, private-sector investors have increased concern .

Under the contract provisions, private-sector companies will build the LNG terminal at their own risk with no government guarantee. The authorities will collect a fee of $10 million. Officials told The Express Tribune as it wanted to expand the capacity of its existing terminal that Engro, that was working the LNG terminal, didn’t participate in bidding for the terminal. It has the land and has planned to prepare an LNG terminal as well. In a new venture together with Energas consortium, the US firm will invest in setting up an LNG terminal. The terminals will be built without government guarantees.

The final date of approval for the LOI of PQA was October 25. A consortium led Sapphire and by Lucky Cement, energas — is very likely to acquire the contract. In addition to that, the terminal construction company will have to submit a performance bond. It will also need to provide an LNG offtake guarantee for 250 million cubic feet per day and will have to submit a performance bond.

This came after the Pakistan Tehreek-e-Insaf (PTI) government enabled the private sector to utilize the idle capacity of existing LNG terminals and pipelines of gas utilities that are public. It will break the monopoly of public-sector companies and the private sector will have the ability to bring LNG at more affordable rates. Company Global Energy did not take part. According to sources, Global Energy has conveyed to the PQA that it had secured an LOI in 2011 under the LNG Policy 2011 that was afterward.

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