Energy Crisis Mitigation


Pakistan is facing serious energy crisis since decades, economic vulnerability of the state on part is because of the states strained energy capacity to fulfil the demands of its industrial sector.  A significant reason for the power susceptibility has been the soared gap between the supply and demand of the state, majorly because of the state’s insufficient support to energy sector due to its financial constraints.

Pakistan, to meet the increasing demand of energy has cracked a 10 years short term flexible and sustainable supply of liquefied Natural Gas (LNG) from Qatar. According to the deal, Pakistan will import additional 200 million cubic feet LNG per day for the first year of the agreement which will later be increased to 400 mmcfd. Government is confident to have negotiated first ever publically disclosed contract of lowest price, which is 31 percent less than the negotiated price of the last administration. Remarkably, this is the same price at which Qatar is dealing with China. The negotiated deal has been sealed for a period of 4 years after which the contract would be flexible to renegotiate prices. A sustained supply is contracted to be established next year in 2022, considering the contract it can be activated 3 to 4 months before January 2022.

It is widely chanted that this deal has not been scored purely on commercial basis, Prime Minister Imran khan himself and the military leadership together has worked for more than a year to crack this profiting and timely deal for the larger interest of the state. This low priced LNG deal will surely address the ongoing energy crisis in country but it is not enough to fulfill the demands of power sector. Pakistan is amongst those countries which are using LNG at very large scale; therefore, it is the need of hour to endure this deal on the similar terms and conditions even after four years. Considering the growing ties with the foreign world, this is a positive sign for the administration which has been continuously addressing the imperative and long-neglected foreign affairs of the state. Extended diplomatic channels during PM Khan’s tenure will be rewarding for the state in years to come.

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