KARACHI, Jan 30: Pakistan’s Associated Group has signed an agreement with Excelerate Energy of the US to jointly develop an LNG import option for Pakistan. A memorandum of understanding (MoU) was signed by Associated Group chairman Iqbal Z. Ahmed and Excelerate Energy president Kathleen Eisbrenner in London last week in this respect.

The US company is the patent-holder of the technology which permits re-gasification of LNG onboard gas-carrying marine tankers and transmission of this gas through a submarine channel, thereby removing the large costs associated with developing conventional onshore receiving and re-gasification infrastructure.

In a press statement Mr Iqbal said that setting up of a conventional LNG terminal could cost anywhere between $500 million to $1 billion. With the technology being offered by the Excelerate, the cost could be pared down to about $50 million, which would make LNG imports highly viable.

The US company has a model LNG project operating in the Gulf of Mexico, which withstood the impact of last year’s Hurricane Katrina, and is developing similar projects for Boston and the United Kingdom, he said.

The patented technology being used by the US company can enable Pakistan to receive LNG within six months from all government approvals being in place, he said, adding that however both local and foreign companies were not seeking any government throughput or purchase guarantees either, which makes our proposal truly unique.

Natural gas accounts for 50 per cent of Pakistan’s current energy mix. This is expected to increase to 55 per cent over the next five years.