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SIFC directs Petroleum Division to remove hurdles in Qatar’s LNG terminal investment

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1 year ago

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  • Petroleum Division has been asked to resolve all issues so that investment from Qatar could be ensured, says official.
  • PD asked to resolve all issues to make way for Qatari investment.
  • Investment has been pending for last five years due to red-tapism.
  • Petroleum Division secretary personally trying to resolve all issues.

ISLAMABAD: The Special Investment Facilitation Council (SIFC) has directed the Petroleum Division to remove hurdles in the $200 million Qatari investment in an LNG terminal, reported The News on Friday citing sources.

“Energas plans to establish the LNG terminal with Regas capacity of 750-1,000 MMCFD having a shareholding of 49% of Qatar Gas and 51% of Energas. To be erected on BtB model, the investment from Qatar has been stalled for the last five years due to bureaucratic red-tapism,” an official, who spoke on the condition of anonymity told the publication.

Qatar raised the issue during the Pakistan Tehreek-e-Insaf (PTI) and Pakistan Democratic Movement multiple times but no progress could be made on OGRA network code, tax holiday, TPA exemption, SNGPL GTA (gas transmission agreement).

“This time SIFC has taken up this issue with the intervention of top military leadership and directed the mandarins of the Petroleum Division to resolve all the issues and report back so that the investment from Qatar could be ensured.”

A senior official told the publication that following the SIFC’s intervention the Petroleum Division secretary is personally looking into the issue and trying to resolve all issues.

The Energas Terminal, which is to be operated without any government guarantee on RLNG takeoff, will have the capacity to re-gasify up to 1,000 million cubic feet per day (mmcfd) of LNG.

However, Qatar is not the only one interested in LNG projects. Pakistan Port Gas Limited’s LNG Terminal-2 and Tabeer LNG Terminal owned by Japan’s Mitsubishi have been in the pipeline for a long time.

The projects were supposed to become operational in 2021 on a BtB model but are yet to take off because of red tape.

“The ministry is working on the issue as the government wants more LNG terminals on BtB model,” said Energy Minister Muhammad Ali told The News.

According to Energy Ministry officials, the Petroleum Division has wasted five years to install LNG terminals. At the same time, it could not lay another RLNG pipeline from Karachi to Lahore (North-South or Pakistan Gas Stream Pipeline).

Both the PTI and PDM governments failed to develop infrastructure to support the import of RLNG. Under the existing scenario, the government has signed contracts with the existing two LNG terminals — Pakistan Gas Port Limited Terminal (PGPL) and Engro Elengy Terminal (Private) Limited (EETL) with sovereign guarantees against the import of 1.2 bcfd at the maximum.

However, if Pakistan’s wishes to import more RLNG then it would need more terminals and a pipeline.

The Sui Southern Gas Company (SSGC) board has allocated pipeline capacity to the Energas Terminal and signed GTA, the official said. However, the approval for pipeline capacity from the Sui Northern Gas Pipelines Limited (SNGPL) board is still pending and consequently, the GTA could not be signed.

Furthermore, the official said incomplete documentation of the Third Party Access (TPA) associated with the Oil and Gas Regulatory Authority is also causing delays. The interim pipeline capacity has become necessary due to the incomplete OGRA-TPA documents.

“The network code, which is crucial for operationalising the network, also remains incomplete, with no progress towards its finalisation.”

When contacted, the SNGPL said the ECC in its Oct 27, 2021 meeting allocated pipeline capacity to Energas on the SNGPL network.

The gas supplier added that its Board of Directors in December 2021 accorded in-principle approval for the execution of Access Agreement with Energas and it was incorrect to lay the blame on them.

The SNGPL, after BOD’s approval, shared the final draft of the Access Agreement with Energas in January, 2022 and again in August, 2022 for their signatures. The Energas, however, did not sign the document and insisted on signing the Allocation Agreement only.

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Dar chairs the CCOP meeting; Blue World’s bid offer of Rs.10 billion is rejected.

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2 days ago

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The Foreign Minister/Deputy Prime Minister chaired the Cabinet Committee on Privatization meeting.

Other committee members who attended the conference included the Federal Secretaries of several Divisions, the Ministers of Finance and Revenue, Industry and Food, Commerce, Power, and Privatization.

The CCOP took the PC Board’s recommendation into consideration and suggested that Blue World’s bid of 10 billion rupees for the sale of 60% of PIACL’s shares be rejected. The bid was rejected by the CCOP, who chose to follow the PC Board’s advice.

The government’s determination to sell out PIACL through government-to-government or privatization was reaffirmed by the CCOP.

The CCOP was pleased with the Aviation Division’s evaluation of PIACL’s sound financial standing.

Additionally, the CCOP established a committee, chaired by the Minister of State for Finance, to assess potential transaction possibilities for the privatization of the Roosevelt Hotel and the appropriate modes of adoption in light of existing legal rules.

Prior to its subsequent meeting, the CCOP also ordered that all difficulties be resolved and an agreement for the selling of services to an international hotel be concluded.

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The KSE-100 Index has surged by 790 points, resulting in an all-time peak for the stock exchange.

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The benchmark KSE-100 Index increased by 790 points, marking a new all-time high for the Pakistan Stock Exchange (PSX) at 94,982 points.

The record-breaking performance underscores a surge of optimism and investor confidence in the stock market.

As investors responded to favorable economic signals, the market experienced a significant increase of over 500 points in early trading. Later, the KSE-100 Index reached another record level of 94,786 points after adding 594 points to its upward trajectory.

This positive development comes as the State Bank of Pakistan’s (SBP) foreign exchange reserves saw an increase of $84 million, reaching $11.26 billion during the week ending November 8, according to data released by the central bank on Thursday.

This represents an increase of 0.75% from the previous week. In addition, the nation’s total liquid foreign reserves experienced a modest increase, increasing by $33.7 million or 0.21% week-on-week to $15.97 billion.

In contrast, commercial banks’ reserves experienced a decline of $50.3 million or 1.06%, ultimately settling at $4.71 billion.

Furthermore, the economic team of Pakistan has expressed confidence in the discussions with the International Monetary Fund (IMF). Minister of State for Finance Ali Pervaiz Malik, in an exclusive conversation with Samaa TV, claimed talks were moving in a positive direction.

Highlighting improvements in Pakistan’s economic conditions, Malik noted substantial progress over the past six months to a year. He emphasized that Pakistan’s current economic situation has seen significant enhancement, with a reduced current account deficit of only $100 million in the first quarter, a reflection of the government’s strategy to increase remittances and boost exports.

Malik shared that discussions with the IMF are primarily focused on external financing, and while there have been speculations about a potential mini-budget or an increase in the petroleum levy, he clarified that these are currently premature considerations.

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Positive IMF negotiations propel KSE-100 Index above 94,000 points

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3 days ago

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As a result of investors’ optimism about the reported progress in the continuing talks with the International Monetary Fund (IMF), the Pakistan Stock Exchange (PSX) experienced a robust surge.

The benchmark KSE-100 Index of the PSX, which tracks market sentiment, rose 713 points to a new record high of 94,068 points, breaking above the 94,000-point barrier, as the trading session began.

Early in the day, the stock market began its upward trajectory as the KSE-100 Index steadily rose, gaining 574 points to reach 93,932 points. A possible agreement with the International Monetary Fund (IMF) might lead to more fiscal stability and back Pakistan’s economic reforms, which is why investors are so optimistic about the country’s future.

Officials from the Federal Board of Revenue (FBR) informed the International Monetary Fund (IMF) on Wednesday that the government would not be introducing a mini-budget and would instead continue to aim to collect Rs12,970 billion in taxes each year.

In line with continuing discussions with the Fund, FBR sources revealed that petroleum goods will not be subject to the General Sales Tax (GST).

The fact that Pakistan’s tax-to-GDP ratio has increased from 8.8% to 10.3%, a 1.5% gain viewed as a favorable sign of Pakistan’s fiscal policies, has reportedly pleased the IMF, who has voiced satisfaction at Pakistan’s recent economic performance.

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