ISLAMABAD: Despite lower availability of spot cargoes, the basket price for imported Regasified Liquefied Natural Gas (RLNG) has come in at $12.62 per million British thermal unit (mmBtu) for sale at distribution stage, almost 50pc higher than last year.

The average price for December is, however, 20pc lower when compared with $15.68 per mmBtu last month.

In a notification issued on Wednesday, the Oil and Gas Regulatory Authority (Ogra) worked average sale price for SNGPL at $12.624 for December, down 19.5pc against $15.68 per mmBtu in November and $8.43 per mmBtu for December 2020.

Ogra said the price of RLNG was down $3.0553 per mmBtu (19.49pc) for the consumers of Sui Northern Gas Pipeline Company Ltd (SNGPL) and $3.0490 per mmBtu (19.77pc) for Sui Southern Gas Company Ltd (SSGC) in December when compared with November.

The Ogra’s data showed that the government could arrange only 10 LNG cargoes for current month when compared 12 cargoes during the same month last year, leaving a shortfall of over 200 million cubic feet per day.

The average cost of six long-term contract cargoes of Pakistan State Oil (PSO) had stood at $5.78 per mmBtu in December 2020 which increased for eight to an average of $10.11 per mmBtu in December, showing an increase of 75pc. This was despite two additional long-term cargoes at 10.2pc of Brent from Qatar against 6 cargoes under older contract at 13.37pc of Brent.

The average cost of two cargoes by Pakistan LNG Ltd came in at $9.48 per mmBtu this December when compared to six cargoes at an average of $7.06 per mmBtu in December last year.

The regulator said the provisional price of RLNG had reduced for the consumers of SNGPL to $12.6238 per mmBtu from $15.6791 in November. On the other hand, the distribution price for consumers of SSGC decreased to $12.3769 per mmBtu in December from $15.4259 mmBtu in November.

As per the Ogra notification a total of 10 cargoes are due in December, with eight cargoes coming from two long-term PSO contracts with Qatar and two are coming to PLL long-term contracts. There are two reasons for decrease in RLNG prices, which are the non-procurement of LNG under spot purchase and procurement of two cargoes from new long-term contract with Qatar at cheaper rates.

The lower import this month is due to PLL’s inability to attract even a single bid for its eight LNG (liquefied natural gas) cargoes, under the spot purchases, meant for December and January 2022 mainly due to supply constraints in the international LNG market.

Published in Dawn, December 9th, 2021

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