By SKM
April 24, 2026
ISLAMABAD, April 24, 2026: Pakistan has approved the purchase of one liquefied natural gas (LNG) cargo at $18.4 per million British thermal units (MMBtu) while rejecting two others, as it navigates tight global supply conditions and anticipates potential improvements in regional shipping routes, official sources said on Friday.
Pakistan LNG Limited (PLL) received four bids for three spot LNG cargoes from international suppliers, with prices ranging from $17.998 to $18.880 per MMBtu. The bids came from TotalEnergies Gas & Power, Vitol Bahrain, and OQ Trading, all of which submitted technically qualified offers for different delivery windows.
For the cargo scheduled between April 27 and April 30, TotalEnergies initially submitted the lowest bid at $18.88 per MMBtu, which was later reduced to $18.4 per MMBtu. The government approved this revised offer. For the second cargo, scheduled between May 1 and May 7, Vitol Bahrain offered the lowest bid at $18.54 per MMBtu. For the third cargo, due to arrive at Port Qasim between May 8 and May 14, OQ Trading placed the lowest bid at $17.997 per MMBtu, while Vitol Bahrain also submitted an alternative offer of $18.74 per MMBtu.
Despite receiving these offers, PLL—after consultations with decision-makers—rejected bids for the second and third cargoes. Officials said the decision reflects expectations that conditions around the Strait of Hormuz may improve soon, potentially enabling Pakistan to receive up to four LNG cargoes currently stranded in Qatar.
The rejected cargoes were reportedly affected by earlier disruptions linked to regional tensions, including restrictions on shipping routes that have delayed deliveries. Officials indicated that Pakistan is hoping to source additional supply from long-term contracts with QatarEnergy once shipping normalizes.
Global LNG prices remain elevated, with the Japan Korea Marker (JKM) benchmark hovering around $16.47 per MMBtu. Pakistan’s approved spot cargo, at $18.4 per MMBtu, is therefore significantly above prevailing international benchmarks, reflecting tight supply conditions and urgent procurement needs.
Pakistan does maintain long-term LNG supply agreements, including a 15-year contract with Eni, under which one monthly cargo is priced at 12.14 percent of Brent crude—equivalent to about $12.8 per MMBtu. However, the government has recently diverted 11 cargoes from this contract to the international market between February and December 2026 due to lower domestic demand for regasified LNG (RLNG).
Additionally, 24 LNG cargoes have been diverted from QatarEnergy during 2026 under Pakistan’s long-term arrangements. The country’s import portfolio with Qatar includes a 15-year contract priced at 13.37 percent of Brent and a 10-year agreement at 10.2 percent, together covering nine cargoes per month—five under the higher pricing formula and four under the lower one. For 2026, Pakistan had planned imports of 89 LNG cargoes out of a total of 124, including 88 from Qatar and one from Eni.
However, supply disruptions have intensified amid regional instability, including the reported Iran–US conflict in 2026. Qatar’s LNG facilities were damaged on March 2, 2026, prompting QatarEnergy to declare force majeure. The disruption, combined with shipping constraints around the Strait of Hormuz, has prevented Pakistan from receiving four out of ten LNG cargoes currently stranded in Qatar.
With electricity demand rising sharply during the summer months and domestic supply constraints persisting, Pakistan has increasingly turned to the spot LNG market despite higher costs. While the approved cargo is expected to ease immediate power shortages and reduce load shedding, officials acknowledge that elevated fuel import prices are likely to increase power generation costs and ultimately lead to higher electricity tariffs for consumers. Ends
