Pakistan May Renegotiate LNG Contract with Qatar

Pakistan’s liquefied natural gas (#LNG) #agreement with Qatar allows either party to initiate renegotiation talks next year, according to Petroleum Minister Musadik Malik. However, no decision has been made yet on whether to pursue this option.

In 2016, Pakistan State Oil entered into a 15-year deal with QatarEnergy LNG to import up to 3.75 million tons of LNG #annually. This contract includes a provision for #price renegotiation in its tenth year.

Due to an economic downturn leading to reduced #power #consumption, Pakistan has an oversupply of LNG. In December, the #country deferred five LNG cargoes from Qatar to 2026 without #financial #penalties. Discussions are also underway to postpone five additional cargoes from other #suppliers.

The current #economic situation has decreased Pakistan’s power usage, with over a third of its electricity generated from natural gas. This context underscores the importance of evaluating existing energy #agreements to align with #national interests.