$15 billion LNG deal with Qatar finalized

Society Pakistan & World Affairs
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Re: $15 billion LNG deal with Qatar finalized

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Re: $15 billion LNG deal with Qatar finalized

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Re: $15 billion LNG deal with Qatar finalized

State of mind of sorry losers! Cry in day, cry in night, Whine in day and whine in night. Desert no need to even respond to whiners here, result speak for itself. 2018 report card isnt too far.

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Re: $15 billion LNG deal with Qatar finalized

Oath!
I shall never use Gas in my car, home or for business purpose.
I shall neverever use roads developed by NS and SS
I shall never use hospitals developed by these
I shall not use cheap electricity and shall impose loadshedding on myself, my home and my business.

This oath is for the one who hate for the sake of it.

I saw the same thing on motor way projects, today everyone is benefitting, specially the people of that area

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Re: $15 billion LNG deal with Qatar finalized

I promise , I will never use any road made by 'Ganja' from his personal money
But others can use that too
Because 90 % of that is looted from our nation

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Lol....

Aap ko 100 khon maaf hain!

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Amusing to see the haram khors who defended rental power projects now criticizing "shipping" LNG from Qatar on TV.

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Re: $15 billion LNG deal with Qatar finalized

Since you asked, I hope you will read the details and would ponder too:

I have reference about IPI pipeline and price of Gas India would have got. Obviously, price of gas from Iran to Pakistan would have been same what India would have got, with difference that, India would be paying Pakistan also as transit fee (making Pakistani gas cheaper for Pakistan). You can read the article at the end of the post, but for ease, here is how you can calculate the price:

In 2005, the negotiated price was: $1.15 + 6.3 percent of average crude price (over previous 10 months). It means … if average price of oil was $ 40 per barrel during previous 10 months, than:

Iranian gas price would have been $ 1.15 + $ (40 x 0.063) = $ 1.15 + $ 2.52 = $ 3.67 per MMBTU

Since Gas project was not completed and negotiation was open to revision, in 2009, Iran asked to revise the agreement and proposed: $1.1 + 12 percent of average crude price (over previous 10 months). It means … if average price of oil was $ 40 per barrel during previous 10 months, than using revised pricing if approved:

Gas price would have been $1.1 + $ (40 x 0.12) = $ 1.1 + $ 4.8 = $ 5.9 per MMBTU

Presently oil price is ~ $ 30 per barrel. Now, if average oil price over 10 months stays at ~ $ 30 per barrel than, Price of Iranian gas:

Using old Iranian gas pricing formula, gas price would have been … $ 3.04 per MMBTU

If Pakistan had accepted new formula than Iranian gas price would have been … $ 4.7 MMBTU … still, cheaper than Qatar LNG.

Deal with Qatar is 13.7 percent of average of Brent crude price over previous 3 months. Thus, with an average price of $ 40 a barrel, LNG price would be $5. 48 per MMBTU.

Thus, one can say that: Iranian Gas was much cheaper that Qatar LNG using old agreed formula unless average oil price over 10 months goes below $ 15.5 per barrel.

Anyhow, using formula Iran wanted to re-negotiate. Iranian Gas was still cheaper unless average oil price over 10 months goes above $ 64.5 per barrel.

[That is, without taking into account extra cost of Qatar LNG’s due to infrastructure, transport, storage and insurance, and without taking into account Qatar’s LNG security of supply due to its getting to Pakistan by ship].

Apart of price, other disadvantage about Qatar LNG is that:

1: It would cost Pakistan to transport Qatar LNG (as price is on board in Qatar), and Pakistan has to pay Qatar regardless of LNG reaches Pakistan or get lost in transport.

2: During war time, sea transport could become almost impossible for Pakistan, but nevertheless, Pakistan would be paying Qatar and also loosing out due to shortage of energy (as India, with huge navy, could block Pakistan sea ports).

3: Even within country, transportation of LNG would be more hazardous and costly than gas coming through gas pipes.

4: Pakistan has to spend huge facility and infrastructure to receive LNG from Qatar and transport them to required destinations (storage and transportation cost could be huge), while gas could get connected to already installed gas pipes in Pakistan.

In my opinion, it would have been much better if Pakistan had imported Iranian gas rather going for more expensive and insecure option of Qatar’s LNG, though, should have insisted with Iran to follow old agreed formula of 2005 (considering present world energy supply condition, I believe Iran would have agreed).

I also believe that, average oil price would not go below $15.5 per barrel in foreseeable future, and there is good chances that it might rebound even above $ 65 a barrel. With time and especially due to inflation, chances are that oil price would rise, and in rising oil price, Iranian gas would become more and more attractive.

At present, using old negotiated 2005 formula with Iran, Iranian gas would have saved Pakistan over $2.5 per MMBTU, or around $500 million a year.

Further, if IP would have got extended to India or China (that can only happen once Pakistan starts getting gas from Iran), than Pakistan would have started earning over $1 per MMBTU as transit fee, and since India and China together could have started buying at least 10 times Pakistani requirement, than Pakistan would have got several times more as transit fee what Pakistan would have paid Iran for gas.

[Note: India is now thinking to lay a pipeline undersea to get Iranian gas. Article also gives detail of ‘IPI’ pricing … and India expectation to pay same price what they would have paid buying gas through IPI, plus saving on transit fee]

Iran, India in talks over undersea gas pipeline - AzerNews

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Re: $15 billion LNG deal with Qatar finalized

yeah desert-bird stay quiet, since you won’t be able to respond anyways :hehe:

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Why was iranian gas deal renegotiated in 2009? PPP corrupt much?

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I do not think it was all about corruption. In 2005, average oil price was averaging at around $60 a barrel, and thus Gas price was reasonable using 2005 formula. Then Oil price shot up to around $140 a barrel in 2008, and came down crashing to around $40 a barrel in 2009, then started going up rapidly.

I think, seeing such volatility, plus situation with the price of energy in market, Iran decided to renegotiate a new formula in 2009 (it was not Pakistan, but Iran wanted new pricing formula) .

But I do not think that new formula was accepted, though I am not sure, as what I believe, pricing was left for later time, when Pakistan would start importing gas. In other words, pricing was open to negotiation.

Present government of NS, know that they would not get any commission or favour for gas from Iran. As for Qatar, PMLN has their man (Saifur-Rahman) in Qatar, plus Arabs are used to buying or favouring Pakistani politicians, so NS ignored Iranian gas.

Seeing present situation of energy sector, I am sure Pakistan could have got Iranian gas much cheaply, maybe using same 2005 pricing formula or could have negotiated even better pricing formula, still Pakistan decided to go for Qatar LNG so that NS and his 'henchmen' could loot Pakistan or could please their Qatari masters.

It seems Pakistan is getting cheapest LNG price that Qatar offered to any country, but that cheapest price is not the cheapest price for Gas available to Pakistan. Cheapest price for Pakistan is Iranian Gas.

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Let see obvious case of financially harming Pakistan due to Qatar LNG agreement.

Pakistan signed purchase agreement at $5.63 per MMBTU. That means, average price taken for oil over last 3 months was $41.10 per barrel. This happened knowing that current oil price was ~$27 per barrel, and that price is most likely to go down instead of up, specially when Iranian oil was expected to come in the market.

Facing such circumstance, even if agreed price was supposed to be 13.7 percent of average oil price during last 3 months, any honest person would have waited for next 3 months so that average price comes down.

Plus, couple of days before sanction on Iran was supposed to get lifted, and specially when whole world knew about it, than signing contract with Qatar without waiting for sanction to get lifted and asking Iran for a price, was worse of dishonesty.

In the end, as we can see, Pakistan is getting LNG at much higher price than it was possible, by just needed 3 months before signing the contract ... and obviously much more because agreement was done without asking Iran for cheaper Gas ...

Especially when knowing that original agreement of Gas purchase from Iran was such that if ignored and LNG from Qatar was taken, then Pakistan would be paying more than twice for Gas.

Let see the losses to Pakistan. Let say average oil price over next 10 months stays $27 a barrel, than (using gas agreement on 2005, and present Qatar deal):

Iranian Gas price would have been $1.15 + $1.7 = $ 2.85 per MMBTU
On the other hand ... Qatar's LNG would be = $ 3.7 per MMBTU

So, Pakistan would lose $ 0.85 per MMBTU

On the other hand ... let say, average Oil price increases to $120 per barrel (that can happen) than?

Iranian gas = $1.15 + $7.56 = $ 8.71 per MMBTU
Qatar LNG = $ 120 x 0.137 = $ 16.44 per MMBTU

It means, if oil price increases to $120 per barrel than ... Qatar deal compared to Iranian Gas would be $ 7.73 per MMBTU expensive.

If Oil gets too scarce and average oil price increases to $150 per barrel than ... Qatar's LNG would be $ 20.55 per MMBTU compared to Iranian Gas price of $10.6 per MMBTU ... or Qatar LNG would $ 9.55 per MMBTU more expensive for Pakistan.

Further, in above comparison, I have not included other costs that Pakistan would be having when importing LNG from Qatar, and that, as I learned, could be an extra $2.5 to $3 per MMBTU ... that means, when Pakistan would be paying $5.63 per MMBTU (present price government is quoting), it would actually cost Pakistan around $ 8.0 to $ 8.5 per MMBTU.

Now, I cannot see any reason to believe that PMLN government would make Pakistan pay such huge price for gas from Qatar when Pakistan could have got gas much cheaper from Iran, and still no corruption happened, because either someone in the deal is making big money at the expense of Pakistan, or are completely ignorant and incompetent, but since their own businesses are flourishing day and night, one cannot assume that PMLN thugs caused such big loss to Pakistan due to being incompetent, rather one can safely say that all happened due to corruption.

Note: If the figures I have given is wrong than I request supporters of PMLN to please correct me, telling, where my figures are wrong?

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Assumption is the mother of all F Ups.

You do not have the details of 2005 gas deal. What was the price of oil in 2005? Why use current oil price to compare 2005 deal with today's deal?

Was it PMLN's government that did not move on Iran gas deal? Everyone including Commando Mush and champion of democracy Zard could not move on the deal on American pressure. Why are you blaming PML(N) only? Zardari signed a deal with Iran during his last month in office. If you do not have the details of that deal, why are you making assumptions about it?

The number of 'ifs' in your posts make any analysis invalid. Too many assumptions, in my opinion. Even the Indian deal details have several 'would have beens' in it.

I am sure that Iran gas pipeline would be beneficial to Pakistan and ultimately cheaper than LNG deal. But it is not available. Blame goes to our military for being American 'yes men'. No one stopped Mush from moving on the deal during his decade of enlightened moderation. They simply do not want to stop receiving American dollars.

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Kakaballi: Unfortunate thing with some Pakistanis is that, they hate reading, learning or knowing. They want to know facts without putting any effort or even reading or finding out (unhay wahi chahiyea … kay demagh may aa jaye khud say). Details look cumbersome to them, so they avoid knowing by saying that writing is too long and complicated. If someone bring the facts near them (to stop them whining), they ignore that, and keep whining. They are good in commenting on their own assumptions (or to defend their worldly political corrupt gods) using illogical arguments, and consider that as something all should accept. Right brother?

You asked for reference and I gave you one with details. You have not read the details I gave in my post and started accusing me of ‘If’ and ‘But’, that is ridiculous. Please read the posts before any accusation of using ifs and but.

You should know that when agreements are made, where price is not fixed, but there is variable (in gas price case, variable is average crude oil price), than when analysing price, one have to say that if average crude oil price would be ‘X’ or ‘Y’, as no one can say what average crude oil price would be at any time.

About the assumption I made and you are quoted, than think. How can I say that what would be average crude oil price in next 3 months (unless I lie like NS and his cronies in PMLN)?

But an intelligent guess is that oil price would be below $30 a barrel, specially when Iranian oil would be coming in market and present oil price is $27 a barrel. Then, am I wrong to say that ‘If’ average oil price would be $27 a barrel over next 3 months, to calculate Qatar gas price?

I wrote that present deal with Qatar got signed taking average gas price of $41.1 per barrel when government knew that price is coming down. The also knew that Iran would be out of sanction within couple of days. Still they signed agreement (or deal) with Qatar, buying expensive gas … and that is shear corruption.

And yea, PPP did not signed any pricing agreement with Iran. They only signed agreement about time frame of importing gas. Pricing agreement was left for time import would start (either old formula or new formula). It is all assumption that at the time, Pakistan accepted new Iran’s pricing forumla proposed … but even then, new pricing formula Iran proposed, that also gives Pakistan cheaper gas in long term than Qatar’s LNG, and that also I did mentioned, with details.

[Actually, deal PPP signed with Iran, it was just about laying the Pakistani section of Pipeline along with time frame of importing gas, and that Iran to finance the cost of laying pipeline in Pakistan]

Please Read … and if in doubt, check ‘Pricing’ or ‘Pricing forumla’ is mentioned or not … or it is just about laying pipeline, that Pakistan was delaying?

On 30 January 2013, the Pakistan’s federal government approved a deal with Iran for laying the Pakistan’s segment of a pipeline.[SUP][15]](Iran–Pakistan gas pipeline - Wikipedia)[/SUP]

On 27 February 2013, the construction of the Pakistani section was agreed.[SUP][16]](Iran–Pakistan gas pipeline - Wikipedia)[/SUP][SUP][17]](Iran–Pakistan gas pipeline - Wikipedia)[/SUP]

On 11 March 2013, inauguration of the construction works on the Pakistani section of the pipeline were inaugurated by president of PakistanAsif Ali Zardari and president of IranMahmoud Ahmadinejad.[SUP][18]](Iran–Pakistan gas pipeline - Wikipedia)[/SUP][SUP][19]](Iran–Pakistan gas pipeline - Wikipedia)[/SUP][SUP][20]](Iran–Pakistan gas pipeline - Wikipedia)[/SUP][SUP][21]](Iran–Pakistan gas pipeline - Wikipedia)[/SUP]

According with Javad Owji, managing director of the National Iranian Gas Company, the pipeline in Pakistan is expected to be constructed in 22 months with the participation of Iran.[SUP][22]](Iran–Pakistan gas pipeline - Wikipedia)[/SUP]

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Kakabali: As for Gas pricing formula with Iran, there is only two:

One that got agreed in 2005 and other that Iran wanted to revise in 2009.

2005: $1.15 plus (0.063 x average crude oil price during last 10 months). Formula was offered by Iran, but no formal agreement on pricing formula was reached.

2009: $1.1 plus (0.12 x average crude oil price during last 10 months) ... no negotiation done or formal agreement reached as yet.

In 2013 (agreement between PPP and Iran) ... pricing was left to time import would start ... but agreement was made on laying of Pakistani section of pipeline.

If you have any contrary information with reference that gas pricing formula was also part of the agreement PPP made with Iran in 2013, than bring that out (as, what I know, no talk on pricing happened).

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^^^

Deewaron se baten karna achha lagta hay :)

You have to keep three main things in mind.

  1. IPL was started by PPP, previous government, continuing with this project though it benefits the whole country, but Punjabi party PML(N) will not like this.

  2. N$ is afraid of displeasure of RS and Uncle Sam. This time perhaps he will not get asylum by King of KSA.

  3. Commissions, that is main purpose of this Punjabi PML(N) party whose leaders are suckers of Pakistan's blood, as they think commissions on national business ventures are "Halal" and their bloody right.

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FYI , IP Line is already started !

700km & 42" Gwadar to Nawabshah Pipeline Project is awarded to China Petroleum Pipeline Bureau, a subsidiary of CNPC (China National Petroleum Corp.) and work is starting in next 2 months. Once this 700 km GWD-NWB Pipeline will be completed by Dec 2017 with cost of approx. $2 bn , 81 km link from Gwadar to Iran Border will be completed by ISGS Pakistan. So with Gwadar LNG Terminal , this Pipeline will be converted into IP Pipeline !

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https://pbs.twimg.com/profile_images/697784679647215616/ZpIVBs4e.jpg

Maryam Nawaz Sharif ‏@MaryamNSharif](https://twitter.com/MaryamNSharif) Feb 11

Qatar will be giving 100,000 visas to skilled Pakistanis. Another success bagged by Prime Minister Sharif. A very productive visit MA.

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**

Qatar offers job visas for 100,000 Pakistanis**

**** Nawaz says Zarb-e-Azb, Karachi operations will be taken to logical conclusion * Invites Qatari businessmen to explore investment opportunities in Pakistan***

http://www.dailytimes.com.pk/print_images/456/2016-02-12/qatar-offers-job-visas-for-100-000-pakistanis-1455238840-7579.jpg

DOHA: Prime Minister Nawaz Sharif said on Thursday that Pakistan’s economy had witnessed a great turnaround and development was taking the country forward at a fast pace.

Speaking to the Pakistani community in Doha during his two-day official visit to Qatar, Sharif shared details of his meetings with the Qatari leadership. He said that his hosts lauded the role of the Pakistani community in the development of Qatar. He said that he was proud to get a positive feedback about the Pakistanis who were working with commitment and honesty and using their skills to bring a good name to their country. He said that Pakistan had strong ties with Qatar and it wanted to strengthen them through enhanced interaction at all levels.

The prime minister said that Pakistan had signed a landmark deal on import of liquefied natural gas (LNG) from Qatar. He said that LNG imported from Qatar would help Pakistan generate electricity and produce more fertilizer to meet its domestic needs.

Under the agreement, Pakistan would buy $16 billion LNG from Qatar over the next 15 years. Sharif praised the government of Qatar for providing gas to Pakistan at competitive rates. He said that he pointed out during his meetings with the Qatari leadership that the bilateral trade between Pakistan and Qatar needed to be increased from $300 million to at least $1 billion annually. He said that LNG import would boost trade between the two countries.

Sharif said that measures were being taken to overcome the energy crisis and decrease power tariff. He said that LNG imported from Qatar would help lower prices of products and make them competitive in the international market. He said that Pakistan’s foreign exchange reserves were all-time high nowadays. He said the World Bank president and other financial experts noted that Pakistan’s economic indicators were positive.

Sharif said the security situation in the country had improved after the launch of the Operation Zarb-e-Azb, which broke the back of the terrorists. He said the operation would be taken to its logical end. He said the people of Karachi praised the ongoing operation against criminals.

The prime minister said the China-Pakistan Economic Corridor (CPEC) would help the country’s economy. He said the Gwadar airport would be one of the most beautiful airports of the world. He said that his government was working to improve the Pakistan International Airlines (PIA). He said the government would upgrade the PIA to compete with top international airlines. “Now PIA workers’ strike has ended and we will work to bring it on a par with Qatar Airways,” he said.

Sharif said that numerous projects for power generation were underway and all resources were being used with the help of China. He said the nation must keep in mind the negligence of the previous governments that did not generate electricity. He said that previous governments were duty-bound to install power generation units, but they did not. He mentioned the Chinese investment in Pakistan’s energy sector and said that Pakistan urgently needed electricity to meet its needs.

The prime minister said that previous governments ignored roads and motorways, but the incumbent government was building a network of roads and motorways from the Pakistan-China border to Karachi and Gwadar. He said the Hazara Motorway and 27-kilometre long tunnels near Attabad Lake would be completed in a year.

A member of the royal family, Sheikh Khalid bin Hamad, made a courtesy call on Sharif and offered **100,000 work visas for Pakistanis. **Sharif told Hamad that Pakistan attached immense importance to its relations with Qatar. Minister for Finance Ishaq Dar, Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi and Special Assistant to Prime Minister Syed Tariq Fatemi were also present.

Separately, Sharif said that Pakistan offered incentives for foreign direct investment in different sectors.

Talking to Sheikh Abdullah Bin Muhammad Al Thani, chief executive officer of the** Qatar Investment Authority**, in Doha on Thursday, Sharif invited Qatar to explore investment opportunities in Pakistan, particularly in the energy sector.

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Australia offers LNG supply to cope with energy shortages - The Express Tribune