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 business, in Islamabad, Pakistan June 11, 2022. REUTERS/Salahuddin/File Photo

ISLAMABAD, June 11 (Reuters) – Pakistan will seek out a deferred payment plan for liquefied pure gas acquired beneath long expression specials with Qatar, Finance Minister Miftah Ismail stated on Saturday, as Islamabad faces a harmony of payments crisis and falling international exchange reserves.

Pakistan unveiled a 2022-23 price range on Friday aimed at fiscal consolidation as it attempts to persuade the Intercontinental Financial Fund to restart significantly-needed economical guidance. But the lender has expressed considerations more than the quantities, which includes its existing account deficit. read through far more

“We’ve talked about a deferred payment prepare … or at least I have asked for this … and (Pakistan’s) petroleum minister is performing negotiations and is likely to do the talks,” Ismail informed Reuters in an job interview.

As it awaits IMF cash, funds-strapped Pakistan is faced with slipping international exchange reserves, enough for much less than 45 days of imports, and a massive current account deficit – with vitality buys dominating its report import invoice.

Global energy selling prices have risen to file levels in the latest months amid minimized Russian provide and resurgent desire in Asia.

Petroleum Minister Musadik Malik, who was in Doha this week for talks with Qatari Minister of Condition for Electrical power Affairs and Qatar Electricity chief government Saad al-Kaabi, verified talks but explained his authorities was exploring diverse “innovative” pricing and supply methods in wide-centered talks.

“Deferred payment definitely would be enormously beneficial for Pakistan in the way of hard cash flows, but that is not the only discussion that we are possessing,” Malik stated in an audio information, describing the discussions as “preliminary”.

Qatar’s government did not immediately respond to a ask for for remark.

Phrase CONTRACTS

In recent several years Pakistan has improved reliance on LNG for electrical power generation, but is struggling with common ability outrages as procurement of the chilled fuel stays unreliable and high priced.

Ismail said his authorities was also speaking to Qatar about a new 5- or 10-calendar year LNG supply deal for a few regular monthly cargos, as nicely as an further cargo beneath an current deal.

Pakistan presently has two extensive phrase supply deals with Qatar – the first signed in 2016 for five cargoes a thirty day period, and the second in 2021, less than which Pakistan at present receives three every month shipments.

Malik reported Qatar was amid several suppliers Pakistan was chatting to for expression contracts as it tries to navigate a “scorching” and “pricy” current market.

Pakistan has unsuccessfully tapped the spot marketplace for an additional July cargo, with two tenders above the previous 7 days not returning valid bids.

Ismail claimed two other lengthy-expression suppliers had been not able to fulfil contractual source obligations to Pakistan.

Reporting by Gibran Peshimam in Islamabad Supplemental reporting by Andrew Mills in Doha Modifying by Mike Harrison

Our Criteria: The Thomson Reuters Belief Ideas.