Pakistan to Open Bidding on Two LNG Terminals and an LNG Retrofit

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--Following government approval of Pakistan's first imports of liquid natural gas (LNG), the Ministry of Finance said that future investors will be invited to bid for two large plant projects and a retrofit project to enable the country to handle imports of LNG. Currently, Pakistan does not have the capacity to handle LNG imports.

The country's chronic energy crisis has negatively affected industry, including the key textile industry, and enraged the population of 180 million people with daily blackouts. The importation of gas is aimed to improve the power generation situation.

Companies will be invited to buy, transport and regasify natural gas to sell to the state-run Sui Southern Gas Company Limited. The contracts will cover the construction of two terminals to regasify the LNG. It has been proposed that each terminal would have the capacity to process 400 million cubic feet of gas per day (mmcfd).

Bids also will be invited to retrofit the existing terminal at Karachi port, which was built to handle liquefied petroleum gas (LPG). It has a current processing capacity of 200 mmcfd.

Although terminals can take more than 12 months to construct, an official said that individuals hoped that the retrofit project could be completed within six months of work starting. This urgency is partly driven by the prospect of elections being held next year and the government wanting to appear to have done something about the energy crisis.

There are no estimates on the savings made by retrofitting the LPG terminal. The retrofit is technically challenging. Different tanks are used for LPG and LNG. LNG requires cold temperatures and LPG is highly inflammable.

The bidding phase is expected to be completed by the end of this year. No decision has been made to date on the source of the imported LNG.

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