In 2026, Pakistan will import 85 LNG cargoes from Qatar instead of the previously planned 120
Qatar has agreed to cancel surplus Liquefied Natural Gas (LNG) cargoes, prompting the federal government to reopen previously shut 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 earlier shut down to manage surplus LNG cargoes. Government sources said Qatar has now agreed to cancel 24 LNG shipments for 2026, while the federal cabinet had previously approved the diversion of 45 LNG cargoes on December 12, citing declining domestic demand.
Ministry of Petroleum sources said the surplus cargoes had previously forced the closure of local wells producing 200 million cubic feet per day (MMCFD). The LNG surplus resulted from reduced use of imported gas by 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. In 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 surplus cargoes would help meet the financial obligations of Sui companies, which total Rs850 billion.
The gas sector’s circular debt currently totals Rs3.1 trillion, comprising Rs1.7 trillion in principal and Rs1.4 trillion in interest. Authorities have prepared a six-year plan to manage this debt.
Read: Cabinet approves diversion of 45 LNG cargoes
The plan, which includes three options, will be submitted to the federal cabinet for approval. Proposed measures include a Rs5 petroleum levy and options for debt restructuring and interest relief 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 generation and lower industrial gas demand, 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 deliver one cargo per month until 2032, retaining the option to redirect shipments elsewhere.
Sources told Reuters in November that Pakistan was also negotiating with Qatar for 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 fuelled Pakistan’s Rs2.6tr gas-sector meltdown
Too much gas
Pakistan’s long-term LNG agreements with Qatar and Eni cover roughly 120 cargoes annually, averaging nine per month from two Qatari contracts and one from Eni. LNG imports have declined this year as power producers reduce gas consumption due to higher solar and hydropower generation.
Lower gas consumption by power plants and self-generating industrial facilities has led to a surplus, leaving the system substantially oversupplied for the first time in years.
The surplus has forced Pakistan to sell gas at discounts, cut domestic production, and consider offshore storage or resale of surplus cargoes, government presentations seen by Reuters indicate.
Kpler data show that Eni’s most recent cargo arrived at the GasPort terminal on January 3. 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 by Reuters
