Islamabad, Dec 9: The Board of Pakistan LNG Limited (PLL) met on Sunday to discuss the possibility of purchasing an additional LNG cargo from the State Oil Company of the Republic of Azerbaijan (SOCAR) for January 2025 but could not reach a decision.
The board decided to hold off on any decision due to uncertainties in the demand forecasts provided by gas companies. SNGPL had recently requested the government to import an additional cargo for January 2025, but the spot price of LNG has risen above $15 per MMBTU due to high winter demand.
Pakistan has already secured 12 LNG cargoes under long-term agreements (10 from Qatar and two from ENI), with prices around $10 per MMBTU, which are lower than the current spot price. PLL is hesitant to import expensive spot LNG based on SNGPL’s request.
In July 2023, PLL and SOCAR signed an agreement to purchase one distressed LNG cargo per month. SOCAR offered a price one cent lower than the lowest bid, which upset other bidders and led them to threaten to boycott future LNG auctions.
As a result, Pakistan currently lacks a clear pricing mechanism, making it challenging for PLL to decide whether to purchase LNG from SOCAR on short notice.
