The Cabinet Committee on Energy (CCoE) on Thursday issued directions for activation of a task force as required under LNG Policy 2011 and asked the ministries of Maritime Affairs and Energy to come up with their considered views with clarity on how to allow additional future Liquefied Natural Gas (LNG) imports through Gwadar Port.
The meeting of the CCoE presided over by Minister for Planning and Development Asad Umar took up a report by a committee led by Deputy Chairman Planning Commission Dr Jehanzeb Khan on the establishment of LNG import terminals and virtual LNG pipeline (vehicle-based) at Gwadar.
The virtual LNG pipeline project envisages a floating LNG vessel to be berthed permanently at Berth 3 of the port. LNG will be replenished in the FSU using LNG carriers from Qatar, Abu Dhabi, or Oman being close to Gwadar and discharged into road tankers for onward regasification through vaporizers.
The committee had consulted all the stakeholders under instructions from the prime minister and suggested that strict guidelines be given to the regulator (Oil & Gas Regulatory Authority), port authorities and potential LNG developers to complete the due processes at their specific ends to ensure availability of additional LNG by next winter.
The CCoE was informed of significant investor interest in the sector and the need for LNG import in the country. The Dr Khan-led committee believed there was no need for competitive bidding for the LNG terminal and virtual pipeline under the LNG Policy, nor any requirement for Gwadar Port Authority (GPA) to conduct its own study on the use of the third berth at Gwadar Port or a separate dedicated terminal at a far distance for safety and security reasons.
The report said the safety and viability of using Berth 3 for LNG handling could be ascertained when the potential developer conducts the requisite studies and the Ogra and port authorities will review the findings.
The committee reported that LNG Policy 2011 required an LNG task force comprising all stakeholders to act as a “one-stop-shop” for all LNG-related issues like import projects, interpretation of policies and regulations but had been missing since then. Hence, the task force should be immediately activated.
The report recommended that potential investors be allowed to conduct all the required studies at the port and the Ministry of Maritime Affairs, Ogra and port authorities should process all the pending applications in this regard.
The CCoE also considered the report on the issue of enhancement of domestic LPG production.
Mr Umar also directed the Petroleum Division to submit a summary to the Economic Coordination Committee (ECC) of the Cabinet for the resumption of the operations of Jamshoro Joint Venture Ltd (JJVL) for LPG production.
The Deputy Chairman Planning Commission (DCPC) presented the recommendations on the way forward for maximising affordable gas supply to the residential consumers. The committee underscored the need for addressing both the short- and long-term gas sector issues.
The DCPC recommended that SSGCL should give 8-10mmcfd of its gas at a gas field in Sindh for production of LPG to meet additional requirements amid serious energy shortages while JJVL should clear about Rs420 million of undisputed pending dues immediately, while the remaining Rs6bn disputed amount pending adjudication in the Supreme Court should be pursued by both parties for settlement and JJVL would implement whatever be the court decision.
However, it was noted that the ECC had earlier taken certain decisions on the issue, hence the Ministry of Energy should get back to the ECC for the resumption of the operations of JJVL for LPG production suspended almost a year ago due to NAB investigation and court cases.
