Govt May Allow Private LNG Imports

Pakistan is mulling a move that would permit private entities, including power plants, to import liquefied natural gas (LNG) directly, in an effort to ensure energy security without straining state finances, according to Bloomberg. The Petroleum Division within the Ministry of Energy has put forth a proposal to broaden the auction of vacant capacity at Pakistan's two LNG import terminals, thereby enabling private firms to procure LNG directly from the market.

This proposal arises as Pakistan's two LNG terminals have been largely dormant since March, following the Middle East conflict which disrupted shipments from Qatar, the country's primary LNG supplier. Current regulations make it challenging for non-state-owned entities to purchase cargoes from the spot market. Pakistan GasPort Limited, which runs one of the nation's LNG terminals, has previously advocated for the inclusion of non-state-owned companies in LNG imports.

The nation has grappled with supply disruptions due to the Gulf War and the temporary closure of the Strait of Hormuz, both of which have impacted gas shipments. While Pakistan has bought some LNG cargoes from the spot market to replace lost Qatari supplies, prices have surged to over twice their pre-war levels. Pakistan has traditionally relied on long-term LNG supply contracts with Qatar for consistent supplies.

The Hormuz Strait's disruption led to the cancellation of a Qatari LNG shipment scheduled for July 2026, and Qatar later declared force majeure. This supply disruption has compelled Pakistan to seek emergency LNG supplies and consider alternative fuels, leading to higher-priced spot cargoes. Earlier this month, Petroleum Minister Ali Pervaiz Malik cautioned that fuel prices could soar to Rs.

1,000 per liter if a shortage occurs. However, the Petroleum Division's proposal has not yet been officially confirmed by government sources.