ISLAMABAD: In a significant development, the government has agreed in principle to extend the lease of Engro Vopak Terminal Limited (EVTL) by 30 years, allowing the company to continue operating its liquefied petroleum gas (LPG) and liquid chemical terminal at Port Qasim beyond its current lease term, which ends in 2026.
According to sources, the Port Qasim Authority (PQA) signed the second Supplemental Implementation Agreement (SIA) with EVTL on January 15, 2025, and a third SIA followed on February 24, 2025. EVTL submitted its final lease extension proposal on February 26 after a series of high-level meetings involving PQA, the Ministry of Maritime Affairs, the Ministry of Finance, and the Special Investment Facilitation Council (SIFC).
Following a thorough review of EVTL’s operational model, financial performance, and contractual commitments, the PQA Board recommended a 30-year lease extension on a build-operate-transfer (BOT) and non-exclusive basis. This extension would commence from June 18, 2026, pending final concurrence from the Ministry of Maritime Affairs and SIFC—both of which have now endorsed the proposal.
The initial lease was granted to EVTL in 1995 for land at Port Qasim, which also houses a vital LNG pipeline connecting Engro’s LNG terminal to the Sui Southern Gas Company’s network. EVTL has invested over $100 million in the terminal and signaled further investments contingent on the lease renewal.
Earlier, the Ministry of Maritime Affairs had hesitated to back the extension, citing the need for a fresh tender under Public Procurement Regulatory Authority (PPRA) rules, as the original agreement did not include any lease renewal clause. However, SIFC’s intervention and the strategic significance of the terminal prompted a reconsideration.
The government has now tasked the Finance Division with facilitating PQA in conducting an independent third-party valuation of the terminal’s assets. While the initial deadline for concluding negotiations was January 31, 2025, the government granted an extension until March 2, allowing time for thorough due diligence.
The lease extension is expected to support long-term investments, ensure continuity in critical energy infrastructure, and strengthen investor confidence in Pakistan’s maritime and energy sectors.
Story by Zafar Bhutta
