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LAHORE: The proposal to construct the first LNG terminal in public sector has been put on hold for sometime following a `marvelous’ response from the private sector in handling and regasification of the Liquefied Natural Gas (LNG).

The authorities concerned have, however, been asked to incorporate various things in the proposal in order to process it once the private sector fails to deliver in fulfilling the needs of the country in future. The decision to put the proposal on hold was taken after as many as 10 companies, some of them from China and Europe, approached the government and expressed their interest in constructing LNG terminals at Port Qasim, according to an official source.

The country, at present, has two LNG terminals built in the private sector. The first terminal owned by Engro Pakistan was commissioned in March this year after which it started regasifying 600 to 650MMCFD LNG being imported from Qatar. However, the project was formally inaugurated by the Prime Minister Shahid Khaqan Abbasi in August.

The second terminal project has recently been completed by Pakistan GasPort Consortium Limited that was inaugurated by the premier Abbasi some days ago. From Nov 28, it will also start handling, processing and regasifying another 600 to 650MMCFD of LNG.

“Actually the Pakistan LNG Terminal Limited (PLTL)—a subsidiary of the ministry of energy (petroleum division)—planned to establish the terminal at Port Qasim. On this, it prepared the project’s concept study and sent it to the government (petroleum division). The division agreed with the study, advising the PLTL to put it before its Board of Directors (BoD) for final approval,” an official, who requested anonymity, told Dawn on Saturday.

“A couple of days before, the proposal was placed before the BoD’s meeting for approval. But a majority of the BoD members were of the view that since there was a great response from private sector in establishing LNG terminals, the government first see and allow the private companies to invest and then decide whether such projects in public sector are required or not,” the official privy to the meeting explained. However, the BoD advised the PLTL’s management to keep the study intact by incorporating various things related to business plan, financial impact on the company etc in it.

The official said the study regarding the terminal in public sector had been carried out after the government shelved a similar project along with a pipeline at Gawadar port in Balochistan and directed the PLTL to workout plan for Port Qasim.

“After shelving this, the government directed the PLTL to plan LNG terminal for Port Qasim. It also advised the ministry as well as the PLTL to also keep encouraging similar projects in private sector if launched and completed on fast track keeping in view the country’s growing energy needs,” the official added.

He said if the BoD approved the proposal in future, its project cost would be much less than the cost incurred on the two existing private sector LNG terminals.

Published in Dawn, November 27th, 2017