Out of spot market, Pakistan braces for harsh winters as gas shortfall fears loom

An Egyptian man looks at the Qatari Liquefied Natural Gas (LNG) carrier "Duhail" as its passes through the Suez Canal near the Egyptian port city of Ismailia on April 1, 2008. (AFP/File)
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Updated 28 September 2022

Out of spot market, Pakistan braces for harsh winters as gas shortfall fears loom

  • Pakistan imported its last LNG cargo from Qatar at $17 per mmBtu under a long-term supply agreement
  • At present Pakistan only relies on imported LNG cargoes through long term contracts with Qatar and ENI

KARACHI: Pakistan is bracing for one of the harshest winters this year following skyrocketing prices of Liquefied Natural Gas (LNG) spot cargoes in the global market and record currency depreciation at home, analysts said, as fears of increasing gas outages during peak winter hours loom large.

The south Asian country requires 4.1 billion cubic feet per day (bcfd) of gas, with winter demand peaking to around 4.5 bcfd against local production of 3.22 bcfd. The shortfall is bridged through LNG imports.

Seen as the viable option to meet domestic gas demand, Pakistan started importing LNG seven years ago. However, the price of the commodity in the international market surged from lows of $2 per million British thermal units (mmBtu) in 2020 to highs of $57 in August this year after demand in Europe surged, pushing Islamabad out of the spot market for the time being.

At present the country only relies on imported LNG cargoes through long term contracts made with Qatar and Italian multinational ENI. The term agreements allow the country to import around 8 cargoes per month against the requirement of around 12 to meet the shortfall.

An official from Pakistan LNG Limited (PLL), a state-owned entity mandated to import and procure LNG, confirmed to Arab News on Tuesday that the country was currently importing all term cargoes from Qatar and ENI.

As the spot LNG market remains out of the reach of Pakistan, many Pakistani analysts expect the current winter season to be tough for domestic gas consumers amid shortages of gas.

Pakistan imported its last LNG cargo from Qatar at $17 per mmBtu under a long-term supply agreement.

“Normally the demand in winter increases by around 1 bcfd,” Farhan Mahmood, Head of Research at Sherman Securities, told Arab News. “As this year Pakistan is unlikely to secure cargoes from spot market, it is expected that shortfall and load shedding of gas will be more than last year.”

“With LNG prices currently hovering around $38 per mmBtu and the Pakistani rupee trading at historic lows amid depleting forex reserves, the government may not venture to import costly gas, rather it would prefer to save dollars.”

PLL did not receive any bid in response to a tender floated in July 2022 to import 10 cargoes of LNG

Pakistan’s woes were also compounded after Russia invaded Ukraine early this year and European countries rushed to secure gas supplies from LNG producing countries as Moscow slowed gas flows westwards.

The Kremlin says the West triggered the energy crisis by imposing the most severe sanctions in modern history, a step President Vladimir Putin says is akin to a declaration of economic war

“The Russia-Ukraine war has also disrupted the international market and European countries have rushed to secure cargoes for winter as demand has increased substantially there,” Mahmood added.

Some experts, however, say gas outages would be comparatively on the lower side this winter as high demand for gas will be compensated with additional electricity generation.

“By December this year some 1320MW electricity would be added to the national grid with commissioning of three coal-fired power plants in Thar, Sindh, that would compensate the gas demand,” Tahir Abbas, Head of Research at Arif Habib Limited, a Karachi-based brokerage firm, told Arab News.

“There would definitely be a shortfall of gas but it would not be as severe as it was last year keeping in view the additional electricity generation.”

Pakistan’s policy in winters is to divert gas supplies to domestic consumers from the power sector, which in turn impacts industrial activities.

This year, the government is also expected to encourage consumers to switch over to electricity by offering incentives to save gas for industrial and heating purposes.

In another bid to secure long-term supplies of gas, PLL has invited bids for 72 LNG cargoes from international suppliers across a period of six years. The fate of the tender would be decided on October 03, 2022, when the bids are opened.

The south Asian nation’s import of LNG declined by 3.37 percent to $629.4 million during the first two months, July-August 2022, of the current fiscal year, compared with the same period last year.

Pakistan energy imports increased by 105.3 percent to $23.3 billion during the last fiscal year, FY22, including the imports of LNG which increased by 90.6 percent to $4.98 billion, according to official data.


UK’s Daily Mail apologizes to PM Sharif for 2019 report

Updated 08 December 2022

UK’s Daily Mail apologizes to PM Sharif for 2019 report

  • UK’s Mail claimed in report Sharif was being probed for embezzling funds meant for earthquake victims
  • Sharif had sued the British tabloid in January 2020, saying it was a ‘politically motivated’ article against him

ISLAMABAD: British newspaper The Mail on Sunday and online news website Mail Online on Thursday apologized to Prime Minister Shehbaz Sharif for publishing a 2019 report that said he was being investigated by Pakistani authorities for embezzling fund for earthquake victims.  

British tabloid Mail said in a July 14 article that Sharif, the president of the Pakistan Muslim League-Nawaz party, had embezzled funds provided by UK’s Department for International Development (DFID) for rehabilitation and reconstruction work after a devastating 2005 earthquake. 

A couple of months after the story was published, Sharif hired British law firm Carter-Ruck and filed a lawsuit against the British newspaper in January 2020. The firm, whose lawyers rank in the top tier of media, defamation and privacy lawyers in the United Kingdom, said the article was “gravely defamatory” of Sharif and contained false allegations.  

Sharif said he was appalled to read the story which he said accused him of “stealing British foreign aid money." The younger brother of three-time former prime minister Nawaz Sharif, he was then the chief minister of Punjab, Pakistan’s most populous province.  

“We accept Mr Sharif has never been accused by the National Accountability Bureau of any wrongdoing in relation to British public money or DFID grant aid,” Mail Online wrote in its ‘Clarifications and Corrections’ section on the website.  

“We are pleased to make this clear and apologise to Mr Sharif for this error,” it added.  

"Disinformation & fake news have limited shelf life & truth is ultimate victor," Sharif wrote on Twitter in reaction to the apology.

The DFID had also rejected the contents of the article and said in a statement: “The UK’s financial support to ERRA [Earthquake Reconstruction and Rehabilitation Authority] over this period was for payment by results – which means we only gave money once the agreed work, which was primarily focused on building schools, was completed, and the work audited and verified.” 


Saudi Arabia says ‘will continue to support’ Pakistan financially

Updated 08 December 2022

Saudi Arabia says ‘will continue to support’ Pakistan financially

  • Pakistan’s state bank says in talks with ‘friendly country’ for $3 billion loan
  • Amid soaring infation, cash-strapped Pakistan is in desperate need of finances

ISLAMABAD: Saudi Arabia’s Finance Minister Mohammed Al Jadaan said the kingdom would continue to support Pakistan’s finances as much as it can, as the country looks to shore up alliances with others struggling from inflation, Bloomberg reported on Thursday.

With political instability on the rise, Pakistan is beset with various economic problems. The South Asian country has to pay off mounting external debt while its reserves continue to dwindle. It’s currency, the rupee, has failed to register strong growth against the US dollar in recent weeks. 

To make matters worse, in times of high inflation, devastating floods killed over 1,700, destroyed swathes of crops and damaged critical infrastructure in Pakistan this monsoon season. The country estimates losses over $30 billion from the floods. 

“The Saudi government will ‘continue to support Pakistan as much as we can,’” Bloomberg quoted Al Jadaan as saying at a press conference in Riyadh.

Last week, Saudi Arabia extended the term of a $3 billion deposit it made to Pakistan's foreign reserves to help the country grapple with its economic crisis.

Earlier today, Thursday, Pakistan’s central bank governor confirmed Islamabad is in talks for a $3 billion loan from a “friendly country”.

“The Government is also in talks with a friendly country for the disbursement of a $3 billion loan and negotiations with multilateral agencies are progressing, for further financial support,” State Bank of Pakistan (SBP) Governor Jameel Ahmad said in a podcast.


Pakistan forms fresh investigation team to probe journalist’s killing

Updated 08 December 2022

Pakistan forms fresh investigation team to probe journalist’s killing

  • Pakistan’s top court directs team to submit progress report every two weeks
  • Fact-finding report says role of transnational figures in killing cannot be ruled out

KARACHI: At the Supreme Court of Pakistan’s directives, the Pakistani government on Thursday formed a new joint investigation team (JIT) to probe the alleged murder of journalist and anchor Arshad Sharif.  

Earlier this week, Pakistan’s Chief Justice Umar Ata Bandial used the so-called “suo moto” provision — which allows him to take up cases on his own initiative — to set up a bench of five judges to supervise an investigation into the killing of the prominent television journalist in Kenya in October.  

Sharif, an outspoken critic of the government who also turned his guns on the military during the later part of his life, was shot to death by Kenyan police in Nairobi in October.   

Kenyan police said Sharif’s killing was a case of “mistaken identity” during the search for a car involved in a child abduction case. But a two-member Pakistani fact-finding team that visited the East African state subsequently called the killing a “targeted assassination.” 

On Wednesday, the Supreme Court of Pakistan directed the government to form a fresh JIT to investigate Sharif’s killing. During the hearing today, the government’s representative, Additional Attorney General (AAG) Aamir Rehman presented a notification featuring the names of the five JIT members.  

These included Awais Ahmed, deputy inspector-general Islamabad, Muhammad Aslam, an Inter-Services Intelligence (ISI) agency’s representative, Murtaza Afzal, a representative of the Military Intelligence (MI), Waqar-ud-din Syed, director of cybercrimes of the Federal Investigation Agency and Sajid Kiani, deputy director-general of the Intelligence Bureau (IB).  

The notification said that the Ministry of Foreign Affairs (MoFA) and Islamabad Police have been directed to facilitate the team in their probe.  

Chief Justice Umar Ata Bandial, who conducted the hearing of the case with a five-member bench, said MoFA had submitted its reply with “ways and good suggestions.” 

The court then directed the JIT to submit a progress report to the court every two weeks. 

In its response submitted in court, MoFA said the Pakistan missions in Nairobi and Dubai were corresponding to facilitate the process of investigation and gathering evidence.  

The ministry said it was considering sending a special envoy to Kenya to raise the matter with local authorities and also arrange a phone call between the Kenyan and Pakistani foreign ministers.  

MoFA said it was also considering to direct the Pakistani High Commission in Nairobi to push senior Kenyan officials to accelerate the matter. 

Meanwhile, a fact-finding team’s (FFT) report seen by Arab News stated that the role of transnational characters in Kenya, Dubai and Pakistan could not be ruled out in Sharif’s killing.  

“Both the members of the FFT have a considered understanding that it is a case of planned targeted assassination with transnational characters rather than a case of mistaken Identity,” the report said. 

The team noted there were compelling reasons for Sharif to leave Pakistan, adding that criminal cases registered against him in different districts were most likely the reason why he was also asked to leave the UAE by authorities there. 

Sharif had left Pakistan in August over threats to his life and after a slew of court cases related to charges of treason and others were registered against him.  

“The four GSU [General Service Unit] police officials [in Kenya] ... had been used as instruments in this case under any influence, either financial or some other compulsion,” the report said.  

It added that Waqar Ahmad, who hosted Sharif, was connected to the National Intelligence Service (NIS) of Kenya and other international intelligence agencies and Kenyan police. 

His brother, Khurram Ahmad, was driving Sharif back to Nairobi when the shooting incident took place.


In new audio leak, wife of ex-Pakistani PM allegedly tells aide to sell watches

Updated 08 December 2022

In new audio leak, wife of ex-Pakistani PM allegedly tells aide to sell watches

  • Ex-PM Imran Khan’s aide terms audio clip ‘fake’, demands forensic audit
  • Audio put spotlight on controversy surrounding sale of state gifts during Khan’s tenure

ISLAMABAD: A leaked audio recording allegedly featuring a conversation between the wife of ex-Prime Minister Imran Khan and a close aide of the former premier has once again put the spotlight on a controversy surrounding the sale of state gifts during Khan’s tenure in office.

The election regulator in October disqualified Khan from holding public office in a case registered against him for failing to declare assets from the sale of state gifts. Khan was accused of misusing his position as then prime minister to buy items from the toshakhana, or state repository for gifts, to sell at higher rates in the market. A major charge was that the former premier failed to declare some of the earnings in his annual statements of assets submitted before the election commission.

At the heart of the controversy was an expensive Graff wristwatch set gifted to the former premier when he went to Saudi Arabia on his first official trip in 2018. A Dubai-based Pakistani businessman, Umar Farooq Zahoor, has claimed he bought the watch from Khan in 2019.

“Khan sb has some watches, he has said to send them to you so you can sell them etcetera, because they are not of use to him, so he wants that you [sell them],” a voice believed to belong to Bushra Bibi, Khan’s wife, is heard saying to Sayed Zulfikar Abbas Bukhari, a Pakistani businessman and politician who is one of Khan’s closest aides.

“Definitely murshid, I will do it,” a voice purportedly of Bukhari is heard saying, using the Urdu word to refer to a spiritual guide or teacher.

However, speaking to Arab News, Bukhari denied it was his voice in the audio clip.

"No, it has nothing to do with that watch [gifted to Khan by Saudi crown prince],” he wrote in a text message. “And it’s a fake audio. Cut, copy [and] paste,” he added.
 
Bukhari said he had never sold any watch ever, calling for a forensic audit of the clip.
“I’ll [even] pay for forensics to be done,” he added.

Last month, Khan said he would take legal action against Zahoor and the Jang media group that conducted Zahoor's interview in which he said he paid Khan $2 million to buy the Graff set.  

There have been a number of audio leaks from the Prime Minister’s Office in recent months, including discussions between current Prime Minister Shehbaz Sharif and members of his cabinet.

In another leak, Khan is believed to be having a conversation with his then principal secretary Azam Khan about a diplomatic cipher that was at the center of Khan’s allegations that his ouster in a parliamentary vote of no-confidence in April was part of a regime change conspiracy hatched by the United States. Washington denies this.

In another leak, a voice believed to be Khan’s can be heard telling Asad Umar, then planning minister, and Shireen Mazari, who held the human rights portfolio, to forcefully push upon the public the narrative that a “foreign conspiracy” was behind the ouster of his government.

In yet another leak, a voice believed to be Khan’s is heard discussing political horse-trading and the possibility of “buying” five legislators in the days leading up to the no-confidence vote in which Khan was removed.

PM Sharif has since launched an investigation into the leaks and strengthened cyber security protocols in government offices.


At Bali conference, Pakistan backs efforts to get Afghan girls and women back to school

Updated 08 December 2022

At Bali conference, Pakistan backs efforts to get Afghan girls and women back to school

  • Meeting on Afghan women's education co-organized by governments of Indonesia, Qatar
  • Indonesia has made Afghanistan one of its priority foreign aid commitments

JAKARTA: Indonesia on Thursday hosted the first international conference to back education for Afghan women who face growing restrictions from the Taliban government, with the Pakistani foreign minister emphasising a greater role for women in decision-making. 

Afghan girls and women have been facing growing uncertainty since the Taliban took control of the country last year, with an estimated 3 million secondary school girls kept out of school for more than a year.

The International Conference on Afghan Women’s Education was held in Bali and co-organized by the governments of Indonesia and Qatar. This was the first such meeting to take place since the Taliban takeover last year, gathering representatives of 38 countries, including Pakistan, international organizations, NGOs and academics.

In his remarks at the conference, Pakistani Foreign Minister Bilawal Bhutto Zardari highlighted the "importance of education for women and their participation in decision making."

"Need for concrete and practical assistance programs benefiting cross section of Afghan society," the foreign office said in a statement, listing Bhutto Zardari’s main talking points. "Pakistan’s strong support to all efforts aimed at promoting the well-being and prosperity of the Afghan people."

Indonesia, the world’s largest Muslim-majority country and conference host, has made Afghanistan one of its priority foreign aid commitments, with assistance directed mostly to support women’s empowerment and education.

“We cannot choose to remain idle, we must do something,” Indonesian Foreign Minister Retno Marsudi told a press conference.

“I firmly believe investing in women means investing in a brighter future, given the opportunity women can make a critical contribution to society.”

Pakistan Foreign Minister Bilawal Bhutto-Zardari speaks at the International Conference on Afghan Women's Education in Bali, Indonesia on December 8, 2022. (Photo courtesy: Pakistan foreign office)

Marsudi said creating conducive conditions for women’s participation in Afghan society was of critical importance, urging participants to “encourage progress to establish an inclusive government that respects women’s rights” and “guarantee education for all.”

Under its new rulers, Afghanistan has been struggling to achieve growth and stability, as foreign governments have refused to recognize the Taliban while its aid-dependent Afghan economy has been in freefall following the suspension of billions of dollars in foreign aid.

Human rights violations against women and girls have mounted steadily in the last year and restrictions on women’s employment have cost Afghanistan’s GDP up to $1 billion, or around five percent, according to UN data.

The conference was a “good steppingstone,” Qatar’s assistant foreign minister, Lolwah Rashid Al-Khater, told participants of the Bali meeting.

Indonesia and Qatar are working together on a scholarship program dedicated to Afghan people and planning to create economic opportunities through microloans. The two governments are also keen on facilitating policies that would connect the Afghan private sector with their international counterparts.

“One message for the international community: Education is a basic right for all ... And it’s important for myself and my colleagues as well — me as a Muslim woman — to confirm that this is not part of a faith; preventing women from their basic rights is not part of the faith,” Al-Khater said.

“It is our obligation as Muslim-majority countries to confront that and to say to any actors that this does not represent us, this does not represent the faith of Islam.”