Pakistan has yet to approve a proposal to import 22 liquefied natural gas (LNG) cargoes for winter, raising concerns about shortages and possible supply cuts to industries, power plants and fertilizer manufacturers.
The Petroleum Division has urged the government to proceed with procurement, warning that further delays could disrupt gas supplies and trigger public unrest. However, the proposal remains pending with the Cabinet Committee on Energy (CCOE), despite approval being sought last month.
Procurement for the first 12 cargoes was scheduled to begin between October 7 and 10. Those deadlines have passed without a formal decision. Petroleum Minister Ali Pervaiz said the matter remained before the committee.
Uncertain Qatari Supplies Complicate Winter Planning
The import plan had anticipated at least 11 cargoes from Qatar under a long-term agreement. However, Qatar’s extension of force majeure until November has cast doubt over those deliveries.
Officials said the government had also considered importing 15 cargoes instead of 22, but warned that fewer shipments could deepen shortages during peak winter demand.
At an estimated $87 million per cargo, purchasing all 22 shipments at that price for delivery between November and February would cost nearly $2 billion. The final bill would depend on the availability of contracted supplies and the volume purchased from the spot market.
An earlier estimate put the cost at $1.5 billion, assuming Qatari supplies at around $12 per million British thermal units. Greater reliance on spot purchases could increase the financial burden.
The proposed procurement arrangements included four cargoes from Azerbaijan through Pakistan LNG Limited, four arranged by Pakistan State Oil with other market participants, and three from a US government-nominated supplier. Several proposed deadlines for arranging shipments have already passed.
Households Would Receive Priority
Winter gas demand is projected to increase from 850 million cubic feet per day to 1,600 million cubic feet per day. Demand on the Sui Northern Gas Pipelines Limited (SNGPL) network alone is expected to double from 550 million to 1,100 million cubic feet per day.
Under the Petroleum Division’s proposal, households would receive priority, with supplies planned from 5 a.m. to 10 p.m. and adequate pressure maintained during cooking hours.
Gas allocations for industrial users, power plants and fertilizer manufacturers would depend on availability. Compressed natural gas stations could face curtailments, particularly in December 2026 and January 2027.
In the event of severe shortages, supplies to cement plants and other industries could also be reduced to protect household consumption.
Fertilizer Output Faces Disruption
Officials said at least two fertilizer plants connected to the SNGPL network could face gas supply suspensions.
Separately, the Ministry of National Food Security and Research estimated that the closure of Fauji Fertilizer Bin Qasim, Fatima Fertilizer and Agritech could leave a monthly urea shortfall of 109,000 metric tonnes.
The Petroleum Division has compared the foreign exchange cost of importing LNG for fertilizer production with importing urea and providing subsidies. Its assessment indicated that importing LNG and supplying it to consumers would carry greater financial implications over one month than importing urea.
With the cargo volume and procurement arrangements still undecided, the government faces a choice between committing foreign exchange to additional LNG purchases and accepting tighter supplies during the winter peak.
