Abbasi defends LNG contract with Qatar

Updated October 27, 2017

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PRIME Minister Shahid Khaqan Abbasi addressing the Senate on Thursday.—APP
PRIME Minister Shahid Khaqan Abbasi addressing the Senate on Thursday.—APP

ISLAMABAD: Prime Minis­ter Shahid Khaqan Abbasi has justified the LNG contract with Qatar, claiming that Pakistan had settled for the cheapest price among all 15-year term contracts in the world.

Responding to a calling attention notice in the Senate on Thursday, he described the agreement negotiated for about 14 months as a big achievement. Pointing out that Pakistan was purchasing LNG at 13.3 per cent of Brent while Japan — the largest importer of LNG — was buying it at 14.5-15pc of Brent.

He said the slope enhances due to uncertainty factor when it comes to a stretched contract for procurement of LNG.

Tells Senate deal was signed under his supervision and he is ready for a debate on it

He said successive governments had been trying to ink agreements for purchase of gas since the days of General Pervez Musharraf in power, but to no avail. He said the previous PPP government had also tried to do it through a memorandum of understanding but the move could not materialise, and Pakistan continued to face an energy crisis. “The prices of that time are also part of the record,” he remarked. He said efforts had been made one after the other, but yielded no positive results.

Mr Abbasi said it was the first contract with a price renegotiation clause under which Pakistan can terminate the contract after 10 years if it so desires. Taking full responsibility of the deal, he said it was signed under his personal supervision and he was ready for a debate on it anytime.

Highlighting the benefits derived from the LNG flow to Pakistan, he said in 2013, the fertiliser and power plants and CNG stations were shut down while there was a shortage of gas for the industry and domestic consumers. “When we started work, LNG-based gas flow started in 20 months and now gas is available to each and every consumer all the time. It is for you to judge if it helped the country’s economy,” he remarked.

The prime minister said there was a time when Pakistan was importing around a million tonnes of fertiliser. “This year, we have exported 0.7m tonnes of fertiliser after meeting domestic requirements.” He said all the CNG stations were open and there was room for establishment of new ones. He said new and most efficient power plants of the world were operational and providing cheapest power to the country.

He dispelled the perception that everything concerning the LNG agreement was in the veil of secrecy and said the agreement was available on the PSO’s website and the price was available on record of both houses of parliament. He said some information was missing from the PSO’s website due to a commercial confidentiality clause.

Earlier, Senator Sherry Rehman in her calling attention notice claimed that as per her information the contract price of LNG set between the Pakistan State Oil and Qatar on Feb 10 last year could not be renegotiated earlier than 2026. She said agreement should be presented before parliament.

Leader of the Opposition in the Senate Aitzaz Ahsan rose in his seat after the prime minister’s remarks, but Chairman Raza Rabbani told him that under the rules, he could not speak on the calling attention notice.

Mr Ahsan staged a walkout in protest, which was joined by other opposition parties, excluding the MQM. Earlier during the question hour, Minister for Parliamentary Affairs Shaikh Aftab Ahmad said he did not know who owned the Askari Airlines but assured the house that he would inform it after finding out who the owner of the private airline was.

In reply to a question asked by PPP’s Dr Karim Khawaja, the minister said that Askari Air Pakistan, United Airways Pakistan Ltd, Liberty Air and Afeef Zara Airways had applied for licences to operate in the country.

On a supplementary question, PPP’s Farhatullah Babar asked whether the Askari Air Pakistan was owned by the same outfit about which the Senate had been informed last year that it owned over 50 industrial, commercial, business and real estate enterprises throughout the country.

Minister for Parliamentary Affairs Shaikh Aftab, who was replying on behalf of the minister for aviation, said he did not know but promised to find out and inform the house.

The minister, however, said that licences were processed in accordance with the Civil Aviation rules and the National Aviation Policy and that it had given a licence to Air Sial Limited last month to start operations in Pakistan.

The opposition members told reporters that they were not satisfied with the prime minister’s reply and said the contract should be presented before parliament.

Earlier, the leader of the opposition presented a report of a special committee that examined non-implementation of decisions taken by the house recommending that the standing committees of the house should have contempt powers to get their decisions implemented.

Raza Rabbani directed the government to bring the legislation within two months, otherwise, the Senate would move on its own.

Published in Dawn, October 27th, 2017