WASIM IQBAL

ISLAMABAD: Oil and Gas Regulatory Authority (Ogra) has determined for Pakistan LNG Limited (PLL) a levelized tariff of $0.4177 per mmbtu RLNG for the month of May.

According to Ogra’s notification, RLNG terminal charges of PLL have been determined at a levelized tariff of $0.4177 per mmbtu, in accordance with the decision of Economic Coordination Committee (ECC) of the Cabinet on June 28, 2016.

The aforesaid charges are based on 600 mmcfd LNG consignment. During the month PLL has, however, planned the procurement of only two cargoes instead of six cargos which optimally utilized the terminal capacity.

Resultantly, the terminal charges, owing to underutilized capacity, have increased to $1.1671 per mmbtu.

The authority observed with concern that inefficient management of LNG supply chain is unnecessarily increasing the terminal charges, directly impacting RLNG price which is against the ECC decision and public interest. In the previous month, the terminal charges were observed on higher side, the same however, were provisionally allowed on the basis that PLL shall recoup the deficiency in the coming month, which has not been done by it.

In accordance with the federal government’s decision regarding “RLNG Allocation, pricing and associated matters” and advice from Ministry of Energy regarding weighted average sale price dated January 22, 3018, RLNG weighted average sale prices for the month of May have been computed.

The authority, therefore, in view of foregoing, determines the terminal charges at $0.4177 per mmbtu and advises PLL to effectively manage the LNG supply in order to efficiently utilise the terminal committed capacity and meet the consumers demand. Further, it is also pertinent to highlight that PLL has also the RLNG sale license and it should explore multiple avenues for marketing and sale of RLNG in addition to its existing bulk consumers.

During the month of May, PSO and PLL will receive six cargos to transmit to Sui Northern Gas Pipeline Limited (SNGPL) and Sui Southern Gas Company Ltd (SSGCL). PSO will receive 19,200,000 tons and PLL will receive 6,400,000 tons of RLNG.