The provision by Qatar of liquefied natural gas to Pakistan must be seen as complementary to the Iran-Pakistan gas pipeline project, not as a substitute. Both projects, both vital to helping solve Pakistan’s energy crisis, had run into difficulties which were overcome only when a delegation led by Petroleum and Natural Resources Minister Shahid Khaqan Abbasi visited the two countries. In Qatar, while the government had given the go-ahead for the LNG export, it was still necessary to negotiate with Conoco Philips Company, which wanted the government to guarantee its investment. There was also the issue of the retrofitting of the Engro Vopak Terminal Limited LPG terminal to an LNG terminal. After the retrofitting, it would be able to handle the 400 million cubic feet per day of LNG Qatar would export.
Meanwhile, with the Iranian deal with the world powers, the expected relaxing of sanctions means that there should be no barrier to the project. That Pakistan may be behind schedule should be evident from the exemption Pakistan has obtained from the heavy penalty it would otherwise have had to pay. Also, Iran has agreed to review the tariff for the project, and to give financial support for the construction of the Pakistani portion of the pipeline. Iran has asked Pakistan to sign a deal with Tadbir, an Iranian company, for the engineering, procurement and construction of the pipeline.
Both projects are essential for Pakistan’s energy crisis, because the gas from both has been earmarked for power generation. The Qatari gas will go towards generating 2500 MW, while the Iranian gas will generate 5000 MW. It should be noted that this will be thermal generation, which is still expensive, though better than having no power at all. However, the economy will thus continue to be dependent on imported fuel for power generation. However, so acute is the shortage that the 7500 MW made available does not cater to the present shortage, let alone cater for future needs.
The government is showing basic commonsense by its actions. Both projects are of vital importance to the economy, which the government is committed to revolutionise. The Qatari gesture, of allowing the export of 500 million cubic feet of gas a day to help solve Pakistan’s energy crisis is appreciable, and must be met in the spirit in which it is made, especially by a government which has made an end to loadshedding one of the planks of its election platform. The import of this gas would also allow the stretching of indigenous natural gas reserves. More reserves need to be discovered, and that is the task on which the government should now focus.