Pakistan stares at looming gas crisis, plans rationing usage

Pakistan has been staring at a shortfall in cooking gas supply in the months to come, forcing the government to work on a plan, rationing the domestic usage in residential colonies in the country, media reports claimed

Nov 12, 2021
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Pakistan stares at looming gas crisis

Pakistan has been staring at a shortfall in cooking gas supply in the months to come, forcing the government to work on a plan, rationing the domestic usage in residential colonies in the country, media reports claimed. 

The government has a “bare minimum” supply of liquified natural gas (LNG) to cover the demand between December to March next year. In a meeting held by the Ministry of Planning and Development, officials presented a plan to supply gas only three times a day to residential colonies.

“Gas to residential sector shall be provided three times a day for cooking only,” Dawn quoted the suggestions from the plan. It also said, “RLNG diversion [to domestic consumers] to be made bare minimum keeping in view the operational stability of the system.” 

According to the report, the estimates suggested lower LNG availability in the coming months, particularly January, February, and March. However, the Petroleum Division tried to cover up the deficit by showing relatively smaller deficits against the demand based on the clear intention that the bare minimum LNG would be allowed to flow to the residential sector.

Importantly, the crisis became loomed earlier this month when two LNG supplies companies, ENI and GUNVOR, backed out, citing high prices in the global market, from previous deals whose deliveries were expected this month. Faced with a looming crisis, the government floated an emergency tender. 

A report in The News newspaper this week claimed the government had decided to procure an LNG cargo at a historic high price of $30.6 per million British thermal units (MMBtu). Officials are also looking for a second deal. 

Skyrocketing prices of natural gas in the global market continue to rattle the world, creating a shortfall in several countries and forcing companies to back out from supplying at pre-fixed rates.

The Pakistan government has reportedly been in talks with the two companies that backed out these deals, hoping to find a middle ground for new rates. 

(SAM)  

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