Islamabad: Minister for Petroleum Ghulam Sarwar Khan and Minister for Information Chaudhry Fawad Hussain briefed the media about the decisions taken by the cabinet meeting. They explained that the government has decided to renegotiate LNG terminals deals as an audit unearthed that those contracts were signed at an unprecedented high rate of return in dollars terms. No example of such a high rate of return is available in the world.
Three LNG agreements were signed by the previous government with one to import LNG from Qatar that is also under investigation and the ministry has submitted report to the Supreme Court on LNG terminals.
Two terminals were established on a 15-year contract at a very high rate of return. The first terminal deal was signed between SSGCL and ETPL, Total investment was $120 million, both equity and loans, at a rate of 44 percent return in dollar terms. Deal of second terminal was done on July 1, 2016 with total investment of $135 million on 22.74 percent rate of return as well and the second one is operating below capacity and the government has to pay $245,000 per day for it. The federal cabinet has decided to initially renegotiate the deals and if renegotiation is unsuccessful further remedies will be explored.
