LAHORE - Appreciating the landmark deal of liquified natural gas (LNG) with Qatar, the business community observed that it would help the government overcome energy shortfall in the country by at least by 20 percent.
All Pakistan Textile Mills Association Punjab chairman Amir Fayyaz welcomed the government agreement with Qatar on RLNG import, asking the government to implement the plan of supplying this cheaper gas to the industry at price of $5.5 per mmbtu at least. “We are expecting provision of RLNG at $6 per mmbtu to the industry to make us competitive in the region,” he said.
Terming the deal as a game changer for the local industry, he said that with the supply of 3.75 million tons of LNG to the energy-starved country the supply-demand gap, which is standing at approximately 2-4 BCFD (billion cubic feet per day), will decrease.
Some energy expert have also accused the government of signing dubious agreements for import of Liquefied Natural Gas from Qatar, questioning the levy of over Rs100 billion additional tax on gas consumers to meet the cost of pipeline for transportation of LNG from Qatar to Pakistan.
Raising the question over transparency in the deal, they asked as to why no international tenders were called and why a long-term agreement was signed with Qatar. APBF founding president, who also deals in LPG import business, questioned the decision to construct the proposed pipeline from Qatar for a foreign company with the money of public. Moreover, the transportation problem within the country has not been resolved. The LNG transportation will require pipeline from Karachi to upcountry which will take a long time. And if it is transported through SSGC pipelines the province can raise objection and demand the share, resulting into hike in gas cost.
Under the agreement with Qatar, three LNG-carrying ships would reach Pakistan every month which will be started within 2016 and the number of vessels would increase to five after 2017, he added.
He was of the view that a deal with Iran or Russia could have been made at further cheaper rates. Moreover, Qatar was in pro-Saudi Arabia camp and might force Pakistan to drop gas pipeline project with Iran.
He said the government had bound the future governments to continue with the import of gas on the same terms, as the present government inked the deal for 15 years, which is objectionable.
PML-N Traders Wing general secretary Shahid Nazir said that China Pakistan Economic Corridor is a big breakthrough and its early completion would ensure progress and prosperity in the country and would connect the country to the Central Asian States. He urged the government to ensure timely completion of all projects to keep the momentum of ongoing growth continue.
He said that it was a fact that petroleum prices fell from $124 per barrel to $31 in the international market and the government made the deal when the oil price was lowest in the world. He said that prices of petrol were lowest in Pakistan among oil importing countries, as petrol in India was available at Rs100 per litre while in Bangladesh it was priced at Rs130 per litre.
Federation of Pakistan Chambers of Commerce and industry (FPCCI) president Abdul Rauf Alam said that the deal would save the country $1 billion annually while a further $600 million could be saved in diesel costs for power generators.
He said that forty six billion dollars investment from China, LNG agreement with Qatar and decision of export of manpower to other countries will help country achieve a growth target of seven percent in a speedier manner.
LCCI former president and LPG Association of Pakistan Chairman Faruq Iftkhar that although economy had not come out of woods so far, however the positive developments on the economic front are giving encouragement to the business community.
He said that decision of LNG import from Qatar would resolve the issue of energy crisis and sufficient energy now would be available to keep the industrial wheel run.