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Pakistan to Start Building Gas Pipeline with Russia

Bloomberg logo Bloomberg 04/01/2021 Faseeh Mangi

(Bloomberg) -- Pakistan will start building a 1,100 kilometer (684 miles) pipeline in July with Russia that will allow the South Asian nation to operate more liquefied natural gas terminals.

The South Asian nation will have a majority share of 51% to 74% in the project, while Russia will own the remainder, Nadeem Babar, petroleum adviser to the prime minister, said in an interview on Dec. 14. Pakistan’s gas distribution companies Sui Southern Gas Co. and Sui Northern Gas Pipelines Ltd., which have started acquiring land for the pipeline, will be a part of the project, while a Russian consortium will lead construction.

a large long train on a steel track: Pipework stands at ENN Energy Holdings Ltd.'s liquefied natural gas (LNG) terminal on Zhoushan Island, Zhejiang province, China, on Thursday, Nov. 1, 2018. Gas is in such hot demand in China right now it’s allowing a quirky market to flourish: transporting the fuel on trucks. The country’s top suppliers are loading liquefied natural gas onto tanker trucks and delivering it to users to make up for insufficient pipeline coverage inland. © Bloomberg Pipework stands at ENN Energy Holdings Ltd.'s liquefied natural gas (LNG) terminal on Zhoushan Island, Zhejiang province, China, on Thursday, Nov. 1, 2018. Gas is in such hot demand in China right now it’s allowing a quirky market to flourish: transporting the fuel on trucks. The country’s top suppliers are loading liquefied natural gas onto tanker trucks and delivering it to users to make up for insufficient pipeline coverage inland. Pakistan has become one of the top emerging markets for the super-chilled fuel in recent years as domestic gas production has plateaued, forcing the nation to import cargoes. The nation has also auctioned a record 20 oil and gas blocks to encourage exploration activity, with bids expected by mid-January, said Babar.

Pakistan, which imported its first cargo five years ago, currently has two LNG terminals. It’s running the two terminals at capacity to meet peak winter demand, with 12 cargoes secured for December and 11 for January, Babar said. Two more LNG terminals, Energas and Mitsubishi’s Tabeer Energy, are expected to start in the next few years.

Pakistan has LNG deals for 700 million cubic feet a day and Prime Minister Imran Khan’s government will decide if the nation needs another medium-term LNG contract for five years after reviewing demand from power generators, the biggest consumers of the fuel, in the next three months, said Babar.

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The nation has also decided that it will only import cleaner Euro-5 diesel from January after doing the same for gasoline earlier this year. Besides imports, Pakistan also plans to add 150 million cubic feet a day of domestic gas output this month, including 50 mmcfd from the Mari gas field, Babar said.

(Corrects headline in Dec. 17 story to say Pakistan plans to build a gas pipeline)

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