Due to the continued financial crisis, the government might not be able to purchase three extra cargoes of liquified natural gas (LNG) on the spot market.
While spot LNG prices are now at $13.4 MMBTU ($43 million per cargo), Pakistan LNG Limited (PLL) has told the Petroleum Division that Terminal-2 has the capacity for an extra 1-2 LNG cargoes per month from April 2023 to September 2023.
In light of the continuing financial crisis, which is making it particularly challenging to secure financing for LNG purchases, PLL has suggested that the power sector be asked to examine the possible savings in power generation based on imported more LNG through the replacement of any other fuel.
To lower generating costs compared to any other imported fuel, the Petroleum Division has asked the Power Division for thoughts or suggestions on the PLL proposal.
According to the present plan, PLL will guarantee one cargo each month from March to September 2023. Yet in March, May, June, and September, both PSO and PLL will import a total of nine cargoes, while in April, July, and August of 2023, ten cargoes will be imported.
In order to prevent the cost of expensive fuels like RFO from being passed on to customers, the National Electric Power Regulatory Authority (NEPRA) has frequently asked the Power Division and the Petroleum Division to supply a predetermined amount of RLNG to power plants.
The National Power Control Centre (NPCC), which operates expensive plants, has repeatedly complained during public hearings at NEPRA that they are not being provided with the necessary amount of RLNG for the plants.
In the meantime, on March 17, 2023, Sui Northern Gas Pipeline Ltd (SNGPL) reported grave worries that the system pack has reached saturation, according to a letter from the Directorate General of Gas (Petroleum Division) to the Power Division. The situation, according to SNGPL, has developed principally as a result of a lower power offtake than its declared demand of 521 MMCFD.
As a result of the current scenario, SNGPL is compelled to further cut the amount of indigenous petrol it uses. According to the Directorate General of Gas, SSGC must immediately enhance its power offtake and retain as much RLNG as possible. After electricity starts off-taking petrol in accordance with its declared requirement, the local input from local oil fields will return to normal.
In order to ensure the efficient running of the petrol system, the Power Division has been tasked with advising the involved parties to boost RLNG use in accordance with their demand.