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Pakistan Gets Significantly Lower Rates for LNG After Cancelation of Expensive Bids

Morpheus

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Pakistan Gets Significantly Lower Rates for LNG After Cancelation of Expensive Bids

Posted 2 hours ago by ProPK Staff



Pakistan has received significantly cheaper bids for three cargoes of liquefied natural gas (LNG) to be delivered in March under an urgent tendering process.


The lower bids have been received partially owing to the fall in the international market. Last week, the state-owned Pakistan LNG Limited (PLL) had canceled the bids for LNG deliveries (for March) for three windows as prices in the international spot market started to crash.

Instead, the PLL went for a revised urgent tender on January 22 with a deadline of January 26. These revised bids attracted 26 to 38 percent cheaper rates when compared with the original canceled bids.

According to the reports, PLL received the lowest bid of 13.62 percent of Brent for cargo delivery in the second week of March from ENI of Italy in the second round of bids compared to 22.24 percent of Brent from the same company during the earlier bids. This is a decrease of approximately 38 percent within one week.

ENI’s bid for cargo in the third week of March is also the lowest, with 13.62 percent of Brent. Another company Vitol offered the same bid at 17.81 percent, making ENI’s bid 23.5 percent lower.

The lowest bid for the fourth week of March is at 12.73 percent of Brent from Qatar Petroleum.
The revised urgent tendering also attracted 20 more bidders compared to the previous tender. This highlights that the prices in the spot market have eased as demand has decreased over the past few weeks.

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Patriot forever

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It is still higher than the long term contracts obtained in PMLN.
You do realize Pakistan has paid $238 million less over 2 years in spot purchases as compared to that specific long term contract signed by Plmn. Let's see at the end of the year which comes out cheaper, you have a habit of comparing a few expensive cargoes in winter months while ignoring the considerably cheaper cargoes for the rest 9 months of year.
 

Path-Finder

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It is still higher than the long term contracts obtained in PMLN.
@farok84 please educate this t001 wal!
You do realize Pakistan has paid $238 million less over 2 years in spot purchases as compared to that specific long term contract signed by Plmn. Let's see at the end of the year which comes out cheaper, you have a habit of comparing a few expensive cargoes in winter months while ignoring the considerably cheaper cargoes for the rest 9 months of year.
why was Pakistan blessed with such poojari cancerous dimwits? willing to lie and invent lies for their mian!
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Need to build storage for LNG and purchase as much cheap LNG from the market as its possible! I am shocked that we never built storages for LNG and loose out in the long run who ever failed to plan this needs to be skinned alive.
 
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muhammadhafeezmalik

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You do realize Pakistan has paid $238 million less over 2 years in spot purchases as compared to that specific long term contract signed by Plmn. Let's see at the end of the year which comes out cheaper, you have a habit of comparing a few expensive cargoes in winter months while ignoring the considerably cheaper cargoes for the rest 9 months of year.
We use as much gas in these 3 month as we use in rest of 9 months.
 

farok84

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@farok84 please educate this t001 wal!

why was Pakistan blessed with such poojari cancerous dimwits? willing to lie and invent lies for their mian!
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Need to build storage for LNG and purchase as much cheap LNG from the market as its possible! I am shocked that we never built storages for LNG and loose out in the long run who ever failed to plan this needs to be skinned alive.
Hi,

It is unfortunate we are still comparing spot with term contracts. These are inherently flawed and therefore should be avoided for any intellectual/ healthy conversation.
 

Morpheus

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Revised LNG Bidding Has Resulted in Savings of $30 Million

Posted 56 mins ago by Jehangir Nasir



The Pakistan LNG Ltd (PLL) had issued a tender (PLL/IMP/LNGT30) for three spot cargoes for March on 16 December 2020 and had opened bids on 15 January 2021, with the opening of bids and deliveries ranging from 53 to 66 days.


The Petroleum Division announced that the PLL had received multiple bids for all the cargoes but had decided not to award them in consideration of the rapidly changing supply and demand position.

The PLL had issued an urgent tender (PLL/IMP/LNGT34) for similar delivery windows on 21 January 2021 with an average of 44 to 57 days from bid opening to delivery.
The shorter lead time tender has been awarded while saving an estimated USD$ 30 million for the three cargoes, as compared to the earlier ones.

As stated multiple times before, this again demonstrates that prices are determined by supply and demand rather than through early orders.

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