Pakistan signs new LNG deal with Qatar

Pakistan has signed a new liquefied natural gas (LNG) deal with Qatar which has been described by prime minister’s special adviser on petroleum Nadeem Babar as the “lowest publicly disclosed contract in the world”.

The 10-year deal to import LNG from Qatar will have shipments arriving starting from January 2022. According to the details revealed in a press conference, the deal struck with Qatar Petroleum is for the supply of up to 3 million tonnes annually, with two cargoes a month initially, increasing to four a month within three years.

The shipments under the deal will be 10.2% slope of Brent, which is approximately 30% cheaper than contracts with Gunvor. Prices are expressed as a “slope” against Brent crude oil prices, meaning a percentage of that price, and are typically a pointer for the opaque spot LNG market.

While addressing the news conference Babar explained that one agreement with Gunvor had expired in December last year while another would expire in about 14 months. After the expiry of contract with Gunvor the Qatar supply would replace it completely.

According to the information sent to Pakistan Stock Exchange, PSO is the nominated entity as per the aforementioned government-to-government agreement.