Pakistan State Oil (PSO) is looking forward to constructing a $500 million LNG terminal as part of its diversification strategy.
In accordance with the state-owned fuel retailerÂ’s CEO Syed Muhammad Taha, the import terminal will be constructed near Karachi and will take around four years to complete. He told the media that the company has made an agreement with a few large customers and has started preliminary planning for the project, which will comprise PakistanÂ’s first LNG storage facility.
The top PSO executive stated, “As long as there’s a geopolitical crisis in place, prices will remain elevated, but eventually it will come down. As soon as the prices are conducive we’ll go ahead”.
He further said that the state-run retailer aims to apply for a license to become a mobile wallet operator and, finally, to launch a digital bank, and has earmarked Rs. 1 billion ($17.4 million) to develop a venture capital fund.
The company may need a partner for the project. “So going forward our objective is very clear. We want to venture into different areas,” a PSO executive remarked.
PSO believes that demand for gasoline and diesel might fall to 5-7 percent in the fiscal year that began in July, and it has no plans to purchase any extra fuel oil during that time, Taha said, adding that the government is negotiating with Middle Eastern countries about long-term deals that will fulfill about 80 percent of its imported gasoline demands. Pakistan already has these types of arrangements in place for LNG and diesel.
Moreover, Pakistan has been adversely hit by this yearÂ’s rise in fuel prices, and now it is dealing with disastrous floods exacerbated by climate change. It however received a bailout from the International Monetary Fund late last month, but only after agreeing to increase domestic fuel prices, sources said.
Pakistan has currently two floating LNG import terminals, both near Karachi. Qatar and Mitsubishi Corp. have also shown keen interest to invest in Pakistani terminals.