Shahid Khaqan says: Govt inflicted Rs17b losses thru late buying of 12 LNG ships

ISLAMABAD: Former prime minister and minister for petroleum Shahid Khaqan Abbasi told a private news channel on Friday that despite increasing gas demand in winter, the PTI government did not float tenders, and inflicted Rs17 billion losses on the country through purchase of 12 cargo ships. He said if electricity would be produced through diesel, it would cost the country dearly. He said had the government issued tenders on time, it would have been able to purchase cheap LNG. He said the world was requesting Pakistan to purchase gas for only 4 dollars, but the government did not move. But later bought it at three to four times more price, he added.

He was happy that the incumbent government had admitted the fact that the country needed the liquefied natural gas (LNG).

He said that from day one of the government formation, everyone in the set-up, from prime minister to a lower grade official had been claiming that the import of LNG was a big injustice committed to the country. He said he was the person who took the responsibility for its import and told the government that Pakistan had no other source of energy but the LNG. The country would have faced lots of problems had the LNG not been imported in the past. He said two LNG terminals had been established during the previous government with a capacity of handling 12 cargo ships, which the government had purchased. Three more cargo ships could also be accommodated at these terminals. He said the previous government had contracted long-term and medium-term agreements for eight cargo ships handling. An agreement was signed with Qatar for 15 years and another agreement was signed with an Italian firm for one cargo ship. An agreement for two LNG cargo ships had been made with another company for five years. An agreement signed for five years had, perhaps, already completed its period.

The previous government had signed agreements for eight cargo ships on long-term basis, and the current government was supposed to make agreements for four ships through spot tendering.

Khaqan said Pakistan’s gas needs were quite calculated. It’s included in the countries which are dependent on gas imports. “The real issue is how it goes for its purchase,” added the ex-PM. In winter we need gas for running our industries, CNG and power plants and meet the domestic needs. In winter’s four, five months, it becomes hard to meet the need in different sectors, he added. On the basis of previous years’ experiences, the government should have gone for extra cargo ships’ import. Even in summer, the country needed gas for running power plants. If the country runs all power plants installed so far, it needs 1300 million cubic feet gas daily, Khaqan said.

The former premier said four major companies of the world were ready to install their LNG terminals in Pakistan. Such arrangements are called merchant terminals, in which the country did not need issuance of any guarantee, or giving the surety money. The government only provides them place for installing the terminals and lays down a pipeline so that the commodity could be supplied to the consumers. Even such companies themselves look for the consumers. ExxonMobil, one of the biggest companies in the world, waited for almost two-and-a-half years to invest in Pakistan, but the incumbent government forced them to go away through their non-serious attitude and leveling of charges. He said almost all such companies had abandoned the idea of investment in Pakistan, he added.

Shahid Khaqan said that four power plants, producing 210 megawatts of electricity collectively were installed in Lahore suburbs during General Musharraf era. Those were run for seven years on diesel, and were converted to LNG after its import during the previous government. The conversion helped the country save $100 million annually. Pakistan is saving $400 million every year because of the Qatar agreement, added the former petroleum minister. He said the Qatar agreement was the best thing that happened during the PML-N government. He said the PML-N government made every effort to explore gas reserves in the country, and issued licences to different companies in that regard.

The ex-PM said that after 18th Amendment, an agreement was signed with the consensus of all provincial governments for exploring gas reserves. He said that all the money, generated through Gas Infrastructure Development Cess (GIDC) levy, was with the sitting government. The funds were generated for Pak-Iran and Turkmenistan gas pipeline. He said the Qatar agreement was signed for 15 years, but Pakistan could get out of it after 10 years. He said if Ishaq Dar had fled to London with the GIDC money, a case should be registered against him. He said it had proved till now that the government had badly failed to install any new LNG terminal; it had also been proved that the government was incapable to lay down any gas pipeline, he added.