Pakistan has postponed its liquefied natural gas (LNG) procurement deal with Qatar, shifting deliveries to 2026 instead of 2025. This shift in strategy reflects Pakistan’s focus on managing its energy resources efficiently amidst changing market dynamics.
LNG Supply Deferred Without Penalties
Dr. Malik announced that Pakistan deferred five LNG cargoes from Qatar and is negotiating delays for five more from other suppliers. The deferments will not incur financial penalties. “We currently have a surplus of LNG and are not importing additional cargo,” he said, attributing the situation to an 8-10% year-on-year decline in electricity consumption over the last three quarters.
The decrease in energy demand stems from higher electricity tariffs that have curbed household usage. Additionally, the seasonal drop in natural gas demand, especially during winter, has significantly reduced power utility operations by up to 60% compared to summer.
Efforts to Boost Energy Usage
To counter declining consumption, the government has reduced electricity tariffs to encourage usage and decrease reliance on natural gas for heating.
No Agreement on Russian Crude Oil
Dr. Malik dismissed rumors of a finalized crude oil deal with Russia, calling the reports “completely false.” Contrary to claims of monthly Russian oil shipments starting in January 2025, he clarified, “No agreement has been reached with Russia for crude oil imports.
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Saudi Investments and Domestic Reforms
Highlighting Saudi Arabia’s growing involvement in Pakistan’s energy sector, Dr. Malik revealed that the country has signed agreements worth $2.7 billion with Saudi investors. Thus a Saudi firm has committed $1.7 billion to Pakistan Refinery Limited (PRL), with participation from major companies at a recent roadshow in Saudi Arabia.
Streamlining Energy Governance
The government is implementing reforms in the Directorate General of Petroleum Concessions (DGPC). These include digitization and a new approval framework to improve efficiency. Malik reiterated the government’s commitment to appointing merit-based boards for state-owned oil and gas companies.
Focus on Energy Security and Investment
Despite challenges in the energy sector, Dr. Malik stressed the government’s dedication to ensuring energy security and attracting foreign investments. While managing oversupply and addressing misinformation, Pakistan’s energy strategy reflects a balance between domestic needs and global market realities.
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