LNG deal with Qatar open to renegotiation next year

Published
0
PAKISTAN signed its biggest LNG agreement with Qatar in 2016 for the supply of 3.75m tonnes of gas for 15 years.—Reuters
PAKISTAN signed its biggest LNG agreement with Qatar in 2016 for the supply of 3.75m tonnes of gas for 15 years.—Reuters

KARACHI: Pakistan’s liquefied natural gas (LNG) pact with Qatar allows for either party to initiate renegotiation talks next year but no decision has been taken on whether to do this, Petroleum Minister Musadik Malik told Reuters on Friday.

He was clarifying comments made to a parliamentary committee on energy, as reported in local newspaper The News, which had quoted him as saying: “The Qatar agreement is costly, and we will negotiate better terms next year.”

Malik told Reuters he had been laying out details of the various contracts Pak­istan has for LNG. “One provision was price renegotiation could take place at the 10th year of the Qatar LNG deal,” he said, adding that Pakistan has a whole year to “figure out its options”.

Pakistan’s biggest LNG agreement was signed in 2016 between Pakistan State Oil and Qatar’s Qatar­gas-2, the world’s largest producer, for up to 3.75 million tons of LNG a year for 15 years, although a cancellation option can shorten the deal to 11 years if the parties fail to agree on a new price.

An economic crisis has slashed power use in Pakis­tan, which gets more than a third of its electricity from natural gas, saddling it with excess capacity it still needs to pay for under decade-old contracts with independent power producers.

Citing a surplus of LNG, Malik said in December that Pakistan had deferred five contracted cargoes under the Qatar deal for a year and would now receive them in 2026 instead of 2025, with no financial penalty.

Published in Dawn, February 8th, 2025

Follow Dawn Business on X, LinkedIn, Instagram and Facebook for insights on business, finance and tech from Pakistan and across the world.

Opinion

Editorial

Fixing bond markets
Updated 01 Oct, 2026

Fixing bond markets

Pension funds, insurance companies, mutual funds, retail investors, and eventually, foreign investors must become bigger participants in the market.
Call centre rackets
01 Oct, 2026

Call centre rackets

A NUMBER of recent raids conducted by the authorities in different cities point to the growing threat fraudulent ...
Homeward bound
01 Oct, 2026

Homeward bound

FIVE months after Somali pirates captured an oil tanker carrying a 19-member multinational crew, Somali maritime...
Kashmir unresolved
Updated 30 Sep, 2026

Kashmir unresolved

The just solution lies in India addressing the issue through a trilateral dialogue involving the legitimate representatives of the Kashmiri people and Pakistan.
Water shortage
30 Sep, 2026

Water shortage

THAT the country is entering the Rabi season with an anticipated water shortage of nearly 25pc, the lowest carryover...
Young hearts
30 Sep, 2026

Young hearts

THE observance may have passed, but the message of World Heart Day should not fade with it. The occasion is a useful...