In 2026, Pakistan will import 85 LNG cargoes from Qatar instead of the previously planned 120
Qatar has agreed to cancel excess Liquefied Natural Gas (LNG) cargoes, prompting the federal government to reopen previously closed local gas wells from January 2026. Local gas from the closed fields is expected to start flowing into the system from January.
The gas fields were previously shut down to handle excess LNG cargoes. Government sources said Qatar has now agreed to cancel 24 LNG shipments for 2026, while the federal cabinet had earlier approved the diversion of 45 LNG cargoes on December 12, citing falling domestic demand.
The Ministry of Petroleum Resources said excess loads had previously forced the shutdown of local wells producing 200 million cubic feet per day (MMCFD). The LNG surplus was due to reduced use of imported gas in the power sector, which would normally be fed into the pipeline system.
To prevent potential pipeline damage from unused LNG, the local fields were kept offline. By 2026, Pakistan plans to import 85 LNG cargoes from Qatar, down from the previously planned 120.
According to ministry sources, a total of 35 cargoes will be cancelled, including 24 by Pakistan LNG and 11 by Italian company Eni, generating estimated savings of Rs20.1 billion.
Petroleum Ministry officials said the cancellation of excess cargoes would help meet the Sui companies’ financial obligations, which totaled Rs 850 billion.
The circular debt of the gas sector currently stands at Rs 3.1 trillion, comprising Rs 1.7 trillion in principal and Rs 1.4 trillion in interest. The authorities have drawn up a six-year plan to manage this debt.
Read: The cabinet approves the diversion of 45 LNG cargoes
The plan, which includes three options, will be submitted to the federal cabinet for approval. Proposed measures include a Rs 5 petroleum levy and debt relief and interest waiver options for companies.
Reuters reported in November that Pakistan had reached an agreement with Italy’s Eni to cancel 21 LNG cargoes under a long-term supply contract.
Talks with Qatar
Amid rising renewable energy production and lower demand for industrial gas, Pakistan has taken steps to reduce its LNG purchases, resulting in a surplus of imported gas.
Eni signed a long-term LNG supply agreement with Pakistan LNG Limited in 2017 to supply one cargo per month until 2032, retaining the option to divert shipments elsewhere.
Sources told Reuters in November that Pakistan was also negotiating with Qatar over gas supplies from the Gulf state, including options to defer some cargoes or resell them under existing contract provisions.
Read more: How flawed LNG deals fueled Pakistan’s gas sector’s Rs2.6tr meltdown
Too much gas
Pakistan’s long-term LNG contracts with Qatar and Eni cover about 120 cargoes annually, an average of nine per month from two Qatari contracts and one from Eni. LNG imports have fallen this year as power producers reduce gas consumption due to higher solar and hydropower generation.
Lower gas consumption from power plants and self-producing industrial plants has led to a surplus, which for the first time in years leaves the system significantly oversupplied.
The surplus has forced Pakistan to sell gas at a discount, cut domestic production and consider offshore storage or resale of excess cargo, government presentations seen by Reuters show.
Kpler data shows that Eni’s latest cargo arrived at the GasPort terminal on 3 January. Sources told Reuters that Pakistan and Eni have also agreed to suspend further cargo deliveries in 2025.
Eni delivered 12 LNG cargoes to Pakistan in 2024.
With additional input from Reuters
