Exclusive: Pakistan finance minister to seek deferred payments for Qatari LNG

Pakistan’s Federal Minister for Finance and Revenue Miftah Ismail speaks throughout an job interview with Reuters at his office, in Islamabad, Pakistan June 11, 2022. REUTERS/Salahuddin/File Picture

ISLAMABAD, June 11 (Reuters) – Pakistan will find a deferred payment plan for liquefied natural gasoline bought below very long expression offers with Qatar, Finance Minister Miftah Ismail explained on Saturday, as Islamabad faces a harmony of payments crisis and falling overseas trade reserves.

Pakistan unveiled a 2022-23 budget on Friday aimed at fiscal consolidation as it tries to convince the International Monetary Fund to restart much-desired economical guidance. But the financial institution has expressed fears over the numbers, which includes its latest account deficit. read through more

“We’ve talked about a deferred payment plan … or at least I have asked for this … and (Pakistan’s) petroleum minister is carrying out negotiations and is going to do the talks,” Ismail advised Reuters in an interview.

As it awaits IMF money, money-strapped Pakistan is confronted with slipping international exchange reserves, enough for a lot less than 45 days of imports, and a huge present-day account deficit – with electrical power purchases dominating its document import invoice.

Worldwide electricity price ranges have risen to document stages in latest months amid diminished Russian offer and resurgent need in Asia.

Petroleum Minister Musadik Malik, who was in Doha this 7 days for talks with Qatari Minister of Point out for Electrical power Affairs and Qatar Energy chief executive Saad al-Kaabi, confirmed talks but said his government was checking out different “ground breaking” pricing and source tactics in broad-based talks.

“Deferred payment of course would be enormously beneficial for Pakistan in the way of money flows, but that is not the only discussion that we are obtaining,” Malik claimed in an audio information, describing the discussions as “preliminary”.

Qatar’s government did not quickly respond to a request for comment.

Term CONTRACTS

In latest a long time Pakistan has improved reliance on LNG for electrical energy generation, but is dealing with prevalent ability outrages as procurement of the chilled gasoline continues to be unreliable and high-priced.

Ismail explained his government was also speaking to Qatar about a new 5- or 10-calendar year LNG offer offer for 3 monthly cargos, as well as an further cargo less than an existing deal.

Pakistan currently has two extensive expression source specials with Qatar – the very first signed in 2016 for 5 cargoes a month, and the second in 2021, underneath which Pakistan currently receives a few month-to-month shipments.

Malik reported Qatar was amid a number of suppliers Pakistan was chatting to for time period contracts as it tries to navigate a “hot” and “pricy” sector.

Pakistan has unsuccessfully tapped the place market for an further July cargo, with two tenders about the past week not returning valid bids.

Ismail said two other prolonged-term suppliers experienced been unable to fulfil contractual supply obligations to Pakistan.

Reporting by Gibran Peshimam in Islamabad More reporting by Andrew Mills in Doha Enhancing by Mike Harrison

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