The south Asian country, facing a severe economic and
foreign exchange crisis, has struggled to purchase the super-chilled fueled
following a surge in prices after Russia's invasion of Ukraine last year.
LNG is
crucial for Pakistan, where natural gas accounts for over a third of power
generation and local gas reserves are insufficient to address growing
electricity demand in a country of over 230 million, leading to frequent power
cuts.
Pakistan Gasport is evaluating interest for a cargo from
sellers in Oman, the United States and the United Arab Emirates, Ahmed said.
"We've got different countries which have offered us
different options. We are extremely encouraged by what we've heard today,"
Ahmed told Reuters.
Pakistan
Gasport owns the country's largest LNG import and regasification terminal at
Port Qasim, but LNG imports have historically been facilitated by Pakistan LNG,
a state-run firm that last bought a spot cargo in June 2022 from PetroChina.
A cargo would be the first shipped in by a private sector
company in Pakistan, said Ahmed, who expects LNG prices to fall in coming
years, making spot purchases more attractive.
Ahmed said 12% to the Brent slope was the "price to
beat" for a cargo to Pakistan. That works out to nearly US$11 per mmbtu, a
discount of a sixth to current average Asian LNG prices of US$13.
"If
the government or anybody else can bring LNG at a price of 12% of Brent or
lower, there is a market. The minute you cross that barrier, there is
resentment," he said.
Ahmed
said he expects Pakistan's LNG demand to grow to 30 million metric tons in 5
years, from about 10-12 million tons now.
Importers of all commodities to Pakistan have faced
increased financing costs and higher processing times due to the ongoing
economic and foreign exchange crisis. LNG traders have said sellers to Pakistan
could demand a premium because of the country's low credit rating.
Pakistan Gasport plans to avert such challenges by not
seeking a letter of credit from banks, financing the deal with internal funds,
Ahmed said.
"I
plan to use a currency other than the dollar to facilitate the payment and also
use a semi-barter system to settle," he said.
