LNG: back to square one
PAKISTAN signed a memorandum of understanding (MOU) with the US on Dec 8 for awarding consultancy for setting up a liquefied natural gas (LNG) terminal. This exercise was once done in 2005 and the process continued till 2007 when it was recommended that the government set up an LNG terminal on an integrated basis. A letter of exclusivity was awarded and everything seemed to be moving. If this process would have continued, Pakistan would have an LNG terminal by 2010.
Then came 2008 and with it came the present adviser, Dr Asim Hussain. He meddled with the tender conditions to control the procurement of LNG, for reasons best known to him.
This was in stark violation of Public Procurement Regulatory Authority rules and the process got into a legal tangle and got scrapped. What a sight it was to see the same adviser signing the MOU, to start from scratch, for a project that he destroyed just four years ago?
While signing this consultancy MOU, did he remember his tall claim of actually bringing LNG in December 2011, then in March 2012 and then in July 2012? Not to talk of importing LNG from India via the Wagah border and, of course, retrofitting wrongfully purchased Progas LPG terminal. Is there anything else left to be added except we are back to square one? A person of clear conscience must quit.
DR KAZI KHADIM HUSSAIN
Hyderabad
He meddled with the tender conditions to control the procurement of LNG, for reasons best known to me…
He wanted a guaranteed of a piece of the pie for himself and his backers. This time around you had better pay him.
“…retrofitting wrongfully purchased Progas LPG terminal”?
Not really wrongly purchased, but shrewdly purchased, – a terminal installation he got on a cash kick back on.
Theft adviser and Doctor of Scamology would be more like it. He will be shot after the revolution.
I am a US based energy expert working for a very large French egg & construction company that designs and builds both LNG terminals & LNG ships. These are large projects and a world scale LNG re-gasification plant has to be of 1 bcf/day capacity to justify the very large investment required. LNG re-gas terminal ships can be of lower capacity but are still quite expensive. Pakistan’s shallow coast line presents challenges in bringing in large LNG ships to feed these terminals and so these terminals can become very expensive in overall construction costs and creation of a deep water terminal , a problem also faced by India & China.
But having a terminal is not enough as LNG is not a commodity product like crude oil that you can simply buy off the market. One will need to make a long term contract with an existing LNG producer in either the Middle East or Far East to purchase LNG. These contracts are not easy to make and neither is LNG available freely on the spot market- except for an occasional shipment.
Both these are very complicated tasks- I would say very difficult for Pakistani companies to put together so they either have the wrong concepts in place and so flounder in their effort. Collaboration with a major engineering company will be the good first step towards make a LNG project feasible in Pakistan.
Pakistani companies including Sui gas can accept my advice or keep floundering for another ten years with no result. You do NOT need to go to a consulting company but directly to an engineering contractor with experience in building LNG terminals.
K.Rashid