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New LNG deal signed with Qatar

New LNG deal signed with Qatar

Under the 10-year accord Pakistan to import LNG at rate of 10.2% of Brent


ISLAMABAD:

Pakistan signed a 10-year new agreement with Qatar on Friday to import 200 million cubic feet per day (mmcfd) additional liquefied natural gas (LNG) at cheaper rate.

Under the deal, Pakistan will import 200 mmcfd LNG in first year, and quantity would be increased to 400mmcfd in the next two years. The government says that the price is 31% less than the LNG deal signed with Qatar in 2015 by the then Pakistan Muslim League-Nawaz (PML-N) government.

The PML-N government had signed the deal for 500mmcfd in 2015 at a rate 13.37% of Brent. However, the current PTI government has signed the agreement at a rate of 10.20% of Brent for import of 200 mmcfd LNG.


ISLAMABAD:Pakistan signed a 10-year new agreement with Qatar on Friday to import 200 million cubic feet per day (mmcfd) additional liquefied natural gas (LNG) at cheaper rate.

Under the deal, Pakistan will import 200 mmcfd LNG in first year, and quantity would be increased to 400mmcfd in the next two years. The government says that the price is 31% less than the LNG deal signed with Qatar in 2015 by the then Pakistan Muslim League-Nawaz (PML-N) government.

The PML-N government had signed the deal for 500mmcfd in 2015 at a rate 13.37% of Brent. However, the current PTI government has signed the agreement at a rate of 10.20% of Brent for import of 200 mmcfd LNG.

After the signing ceremony, Special Assistant to Prime Minister on Petroleum Nadeem Babar said Qatar would provide LNG at the lowest rate, following successful joint efforts by the political and military leaderships.

“Today we have signed a very important agreement with Qatar,” Babar said, while sharing with the media persons the details of the agreement, which was signed in the presence of Prime Minister Imran Khan at the Prime Minister House.

The 10-year new agreement, beginning January next year, will deliver initially two ships per month – around 200 mmcfd – and then go up to 4 ships per month — 400mmcfd. The previous contract was for 15 years, beginning with 1 ship per month – 100mmcfd – and going up to five ships a month.

The agreement signed by the last PML-N government had a clause regarding the price review after 10 years that had invited lot of criticism. However, the fresh LNG contract had a clause for price review after 4 years.

Babar said the average price of total spot purchases stood at 11.9% of Brent, adding that the new price of 10.2% of Brent was still 15-16% lower. He maintained that it would ensure price stability and affordability along with supply security.

Based on the volume of new contract, Babar said that Pakistan would pay around $316million less compared to same volume under the existing long-term contract. He added that this had been calculated at $3 billion during the next 10 years.

“Pakistan is providing letters of credit (LCs) worth $170 million under the past contract. It will furnish $84 million under the new contract that amounts to almost half,” he said. “Total supplies under the fresh contract could be about 3 million tonnes against around 3.75 million tonnes of contracted quantities,” he added.

“The Pakistan State Oil (PSO) will import the LNG from Qatar under the new deal as well, but flexibility has also been incorporated in the contract in case import order is to be assigned to Pakistan LNG Limited (PLL),” he said.

Babar said that the fresh supplies would replace the existing long-term contract with the Gunvor Company that expired in December. Another contract with the PLL will expire in 14 months. “So, the new two cheaper ships will replace two expensive ships,” he added.

The special assistant to the prime minister further said that the new contract would become operational in January, 2022 but added that it also provided for at least one additional shipment “in December this year if need so arise”.

Babar said the process to strike the deal was started around two years ago, when he had accompanied the prime minister during his first visit to Qatar. He added that the agreement was discussed at the highest level of the government.

“It is correct that the deal was discussed at the highest level of the government. The prime minister himself had talked to the Amir of Qatar thrice. It took long time to strike the deal at 10.2% of the Brent, which is the lowest publicly-known contract in the world today.”

Responding to a question, he said that Pakistan’s military leadership also had dynamic relations with Qatar, which had been facilitating in Afghan peace talks. “Both the military leadership and the political leadership have the common interest to do things which are in the larger interest of the nation and it was also one of such joint efforts,” he added.

After the signing ceremony, Special Assistant to Prime Minister on Petroleum Nadeem Babar said Qatar would provide LNG at the lowest rate, following successful joint efforts by the political and military leaderships.

“Today we have signed a very important agreement with Qatar,” Babar said, while sharing with the media persons the details of the agreement, which was signed in the presence of Prime Minister Imran Khan at the Prime Minister House.

The 10-year new agreement, beginning January next year, will deliver initially two ships per month – around 200 mmcfd – and then go up to 4 ships per month — 400mmcfd. The previous contract was for 15 years, beginning with 1 ship per month – 100mmcfd – and going up to five ships a month.

The agreement signed by the last PML-N government had a clause regarding the price review after 10 years that had invited lot of criticism. However, the fresh LNG contract had a clause for price review after 4 years.

Babar said the average price of total spot purchases stood at 11.9% of Brent, adding that the new price of 10.2% of Brent was still 15-16% lower. He maintained that it would ensure price stability and affordability along with supply security.

Based on the volume of new contract, Babar said that Pakistan would pay around $316million less compared to same volume under the existing long-term contract. He added that this had been calculated at $3 billion during the next 10 years.

“Pakistan is providing letters of credit (LCs) worth $170 million under the past contract. It will furnish $84 million under the new contract that amounts to almost half,” he said. “Total supplies under the fresh contract could be about 3 million tonnes against around 3.75 million tonnes of contracted quantities,” he added.

“The Pakistan State Oil (PSO) will import the LNG from Qatar under the new deal as well, but flexibility has also been incorporated in the contract in case import order is to be assigned to Pakistan LNG Limited (PLL),” he said.

Babar said that the fresh supplies would replace the existing long-term contract with the Gunvor Company that expired in December. Another contract with the PLL will expire in 14 months. “So, the new two cheaper ships will replace two expensive ships,” he added.

The special assistant to the prime minister further said that the new contract would become operational in January, 2022 but added that it also provided for at least one additional shipment “in December this year if need so arise”.

Babar said the process to strike the deal was started around two years ago, when he had accompanied the prime minister during his first visit to Qatar. He added that the agreement was discussed at the highest level of the government.

“It is correct that the deal was discussed at the highest level of the government. The prime minister himself had talked to the Amir of Qatar thrice. It took long time to strike the deal at 10.2% of the Brent, which is the lowest publicly-known contract in the world today.”

Responding to a question, he said that Pakistan’s military leadership also had dynamic relations with Qatar, which had been facilitating in Afghan peace talks. “Both the military leadership and the political leadership have the common interest to do things which are in the larger interest of the nation and it was also one of such joint efforts,” he added.

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The Other Miracle. by Saeed Akhtar Malik

The Other Miracle.

by

Saeed Akhtar Malik

Towards the end of Zardari’s tenure unimpeded plunder and misrule, PML-N, under the criminal guidance of its grand master, was sharpening its claws to have another dig at a Pakistan, which, as a result of Zardari’s remorseless depredations, was already becoming a carcass.
Nawaz Sharif, the top contender for the title of the greatest crook of a benighted and unfortunate land, in a keen tussle with Zardari, was running for PM a third time. The infamous “Charter of Democracy” signed between these two mega crooks, brought them on the same side, as they planned and executed the rape of their country.
The constitution was suitably amended to facilitate their hold on power, to give them immunity from accountability, and to reduce Pakistan to a confederation. The mutual give and take between Zardari and Nawaz Sharif which led to the mangling of the constitution, also allowed Nawaz Sharif to have a third crack at the fortunes of Pakistan.
 
Pakistan was used to being robbed in multifarious ways. The most usual of these was skimming off huge “commissions” and crafting of SROs, some of which had a life of no more than a day–opening the customs duty door for a single caper in the morning and closing it before nightfall. To this Zardari added his own innovations, like plain highway robbery and putting a huge premium on meetings with him, sought by rich businessmen wanting to become even richer, where time was allotted on a “per minute basis”, where each minute cost the supplicant, quite literally, lakhs of rupees.
But by the time a salivating Nawaz Sharif was due for his third stint at the helm, the conventional theft had lost its charm and thrill. To get one up on Zardari he wanted to do something spectacular. He wanted to pull off a caper which was not a simple spot job, but a linear caper which would keep on giving for at least a decade and a half.
For this, plans for an LNG deal with Qatar were ironed out. First, his own man was to be posted as ambassador to Qatar. Then Saif ur Rehman was made ambassador extraordinaire to bring his business expertise to craft the deal. Then a Pakistani businessman, who could be totally trusted, was brought in. And then, after he won the elections and became P.M for the third time, he appointed a minister in his cabinet to coordinate the massive theft, which was to be his first gift to his country kicking off his third innings of plunder.
The highlights of this deal were:
-LNG would be bought from Qatar at highly inflated prices at a time when gas prices were falling.
-This agreement would tie Pakistan to keep buying gas from Qatar at these inflated prices for the next 15 years.
-A terminal was to be built at Karachi for this LNG. The price of this terminal was U.S.D 30 million, but which was enhanced to between 120-130 million dollars.
-A clause was later added to the agreement, which stipulated that for each day that this terminal was not in use, Pakistan would pay charges of US $272,000—I am informed that for the last 45 days the terminal has not been in use. The readers may calculate what Pakistan has had to pay out!
But the most brilliant clause of this agreement with Qatar is that this agreement will remain “secret”. The reason given for this secrecy is that if the stipulations of the agreement became known, these would be a cause of embarrassment to a “brotherly Muslim country!”
So how was money to be made in this deal? This should be obvious. The difference between the real gas price and the inflated one will go to a Swiss bank account. The ninety or so million dollars “saved” in the cost of the terminal will go to the same account. And lastly, the “earning” of

$272,000 per day when this terminal was idle, would also go to the same account. And the first and last of these expenses to go to this account will keep doing so for the next FIFTEEN YEARS….burn your heart out Mr. Asif Ali Zardari because you’ve been had!
The man who coordinated, crafted, and executed this deal, is none other than Mr. Shahid Khaqan Abbasi, the Prime Minister we have just sworn in to sit on the seat vacated by ex Prime Minister Nawaz Sharif, who has just been kicked out for corruption!

Could there really be a greater miracle than this?

But the attendant question is, how does a poor country like ours pay for a deal like this? The answer is very simple. We get loans from IMF. These loans pay for scams like this one. So this is a “circular ” debt. Our leaders do the thieving; to pay for such thefts loans are taken from IMF; and the people of Pakistan are then to pay off such debts to IMF for the next hundred years, while Pakistan loses its sovereignty. Simple.
It is my contention that if the total volume of theft our politicians, bureaucrats, businessmen, and generals have committed, can be computed, it will very nearly equal what we owe to the international lending agencies.
What we owe is known. What we earn is also known. This is simple maths. What we owe is more than we earn. We have to begin repaying what we owe by 2018. This we don’t have the resources to do. When we default on our international debt, sanctions is the first thing we should fear among many other arm twisting measures that will be taken against us. The cumulative effect of all these will be our loss of sovereignty. Those who have put up the money will demand their pound of flesh. It is my conviction that they will demand a surrender of our nuclear assets, an end to CPEC, and free play in Baluchistan.
Pakistan will be brought down to its very knees without an external enemy having had to fire a single shot. The shots that had to be fired have already been fired by our corrupt elite. While we were looking out towards our borders our rulers were busy hollowing out Pakistan. Mega corruption was always the single most lethal threat to our national security and survival and should have been laid down as a national security imperative. 
I have repeatedly tried to impress this on the minds of the powers that be. I have it on very good authority that what I was writing, was being read by Raheel Sharif. I appealed to him repeatedly to see the writing on the wall, and as the de facto guarantor of the security of the state, knock the doors of the Supreme Court to ask for in camera hearing on how Nawaz Sharif and company were impeding the efforts of Zarf e Azab, and how their plunder of the country was tantamount to the single greatest threat to the security of the state. But sadly, becoming Field Marshal, or getting a three-year extension seems to have grabbed the whole of his little mind, leaving little space for weightier matters.
Be that as it may, we are now in need of our third miracle, and this is to take the first miracle, the ouster of Nawaz Sharif, to its logical conclusion. 
Though Nawaz Sharif has been shown the door, he has left behind his pile of “loyal” refuse…. loyal because they were equally involved with the rape of their mother[land] in partnership with him. And they are determined to make Pakistan bleed and drag it to the very edge from where our Supreme Court has tried valiantly to drag it back.
This must immediately be stopped. Pakistan is a bleeding and very weak patient. It cannot bear any more cuts. If it has to survive, the cuts must immediately cease and the bleeding stopped.

The President, the Chief Justice, and the Army Chief should get together to do this. Because the de facto charge of national security lies with the Army Chief, it is he who should bring about this meeting.

And this meeting should decide to do the following 3 things;
1    –   At the moment there are no more than 20 people who need to be put away to ensure that no more instability is allowed to be visited upon Pakistan. About fifteen of them, though ministers today, can be cited for contempt of court. The evidence to do this exists in miles of TV footage. Take these fifteen out and the rest will run for cover.
2  –  The Supreme Court should take suo moto notice of literally hundreds of cases of corruption exposed by our media, and as a first step, put these people on ECL. These people are the only national treasure we have left. We need them to be here so that we can squeeze them and get back the gold they have stolen.
3 –  The President should be strengthened against forced resignation.
Just these three things need to be done, and thereafter the Army Chief need just send around a Subedar and he will be enough to do the mopping up.
In all this, the only thing the army should not be tempted to do is to come in to rule the country.

 

It should though, in partnership with the SC help clear the decks, and follow up with ensuring a clean election. And after the elections, it should throw its considerable heft behind ensuring that reforms be so made that the bureaucracy and the police be so restructured that their postings transfers and promotions are not hostages to the executive. Without subverting the police and the bureaucracy to their ends, political leaders cannot commit theft, and if they still manage to do so, they cannot be immune from the consequences.

The state should be seen as the supreme value. A constitution subverted to barter away the state can only be an inimical document, and must be brought back into a shape which guarantees the security of the state and the welfare of the people for whom it is the supreme law. A mangled constitution like ours is present, which ensures immunity to a corrupt and mercenary elite at the cost of the state and the people, can have no sanctity.
This time is crucial for the destiny of Pakistan. A beginning has been made so that a corrupt few do not make this destiny hostage. But if this beginning does not have a felicitous conclusion, the beginning will have no meaning. This is what the C.J and the Army Chief must be very clear about.
We’ve had the miracle of the ouster of Nawaz Sharif. We’ve then had the miracle of seeing Shahid Khaqaan Abassi elevated to Prime Minister. This second miracle nullifies the first. 
We now need a third miracle. We want the refuse of Nawaz and company swept out not just from our lives, but also from our memory. And we need to see being brought to the book Zardari and his footmen, along with camp followers like Fazl ur Rehman, Asfandyar Wali, Achakzai, the shit that Altaf Hussain has left behind, and the many who are hiding under their beds.
p.s

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I end with urging Gen Bajwa to study and see the threat of mega corruption for what it really is; to redefine national security imperatives and give to this cancer the “honoured” place it deserves in these imperatives; and to openly work with the Chief Justice towards crushing the head of this poisonous snake, so that Pakistan gets a new lease of life. And for these measures to have any credibility, let him begin SIMULTANEOUSLY with the generals who’ve received just a tepid slap on their wrists for bringing dishonor to every man in uniform, and a taint which no amount of dry cleaning can restore to purity.

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