ISLAMABAD: Prime Minister Imran Khan said on Friday Pakistan would save $3 billion through a new 10-year Liquefied Natural Gas (LNG) import agreement with Qatar which the government has labeled as one of the cheapest purchase contracts in the global energy sector.
The two countries signed the agreement in Islamabad under which Qatar will provide three million tons of gas to Pakistan for ten years at 10.2 percent of Brent crude prices.
Federal Minister for Energy Omar Ayub Khan and Qatar's Energy Minister Saad Sherida al-Kaabi inked the agreement at the Prime Minister's Office in Islamabad while the premier witnessed the signing ceremony.
The prime minister later claimed while addressing a ceremony in Lahore that Pakistan would save $300 million annually as a result of the new LNG import deal with Qatar.
"Pakistan will save $3 billion in ten-year time," Khan said.
Qatar's Minister al-Kaabi termed the agreement with Pakistan as "historic" and expressed confidence it would open up new vistas of development.
He said his country would also promote bilateral cooperation in other areas of mutual interest.
Earlier in 2016, Pakistan signed a $16 billion LNG import deal with Qatar until 2031 at prorate of 2.25 metric ton while the price for each cargo was agreed at 13.37 percent of Brent.
Under the new agreement, the government said it would be able to import LNG during winter this year to meet the country's growing energy demand.
"We are upending the costly LNG contract [with Qatar] through a 31 percent new cheaper agreement," Nadeem Babar, Special Assistant to Prime Minister Imran Khan on Petroleum, told reporters in a news conference after signing the deal.
Islamabad would get LNG at cheaper rate even as compared to the spot purchase, he said, adding that the Pakistan State Oil would execute the import agreement.
Providing background information on the new deal, he said the government had been negotiating it with Doha for the last two years and the prime minister had directly spoken to the Emir of Qatar in this connection.
"This is the cheapest agreement in the long-term LNG import deals of the world," he said while denying rumors that the government wanted to keep the agreement a secret.