Qatar Asks Pakistan for Formal LNG Cargo Deferment Proposal

Qatar has requested Pakistan to submit a formal proposal regarding the deferment of LNG cargoes beyond 2030 or to allow Doha to sell part of its contracted supply in the international market under the Net Proceeds Differential (NPD) clause, The News reported.

A senior official said Qatar will issue a counter-proposal once Islamabad submits a written request, with a final decision dependent on mutual agreement.

The development comes as Pakistan LNG Limited (PLL) has been diverting one ENI-supplied cargo per month to the international spot market since February 2025 due to declining domestic demand, a practice expected to continue until December.

Earlier, Pakistan sought to defer 177 LNG cargoes worth $5.6 billion beyond 2030, but the plan mistakenly included ENI cargoes, which fall outside Qatar’s agreements. Under a revised approach, Islamabad intends to utilize 80 of the 108 annual Qatari cargoes, leaving 28 surplus each year—or 140 over five years—valued at about $4.4 billion.

During an August 25 visit to Doha, a Pakistani delegation led by Federal Petroleum Minister Ali Parvaiz Malik explained the drop in local gas demand and sought relief under existing agreements. However, officials acknowledged that deferring 140 cargoes into 2031–2032 is not covered by current contracts.

Pakistan presently imports nine Qatari cargoes monthly—five under a 15-year contract priced at 13.37% of Brent and four under a 10-year contract at 10.2% of Brent. Both follow strict “Take-or-Pay” terms to fuel four Punjab-based RLNG power plants, though actual consumption is falling short.

Unlike Pakistan’s ENI contract, which allows profit or loss sharing on diverted cargoes, Qatar’s NPD clause assigns profits from international sales to Qatar, while any losses are borne by Pakistan.

Officials warn that the country’s gas network is under pressure, with RLNG pipeline line-pack levels exceeding the 5 bcf danger mark. To reduce pressure, local gas fields producing 270–400 mmcfd have been shut, risking permanent damage to wells and impacting LPG and crude output for refineries such as Attock Refinery.

Despite falling demand, Pakistan State Oil (PSO) and the Petroleum Division remain bound to import nine Qatari cargoes monthly. The government must now craft a legally sound and commercially viable proposal, as Qatar awaits a formal request before considering concessions.