Pakistan rejects expensive spot LNG, hopes for cheaper deal from Qatar

Pakistan has decided not to buy LNG spot cargoes from the global market for the time being. Pakistan LNG Limited (PLL) has also rejected the lowest bids from BP Singapore and Total Energies. The reason is that Pakistan expects to get even cheaper LNG from Qatar under a long-term contract.

According to sources, there are possibilities of getting 2 LNG cargoes from Qatar at Term Contract rate and this LNG may be available at a rate of 13.37% of the price of Brent crude oil. Positive indications have also been received from Qatar about the supply of cargoes and these cargoes will be delivered to Pakistan via the Strait of Hormuz.

The government’s clear priority is to reduce the cost of energy imports and for this purpose, it should rely on long-term contracts instead of the spot market. This decision is part of this strategy because prices in the spot market fluctuate while long-term contracts prove to be relatively stable and cheap.