Punjab Chief Minister Mian Shahbaz Sharif called on the Emir of Qatar Sheikh Tamim bin Hamad Al Thani here on Monday and conveyed congratulations of Prime Minister Nawaz Sharif on the occasion of his assuming the reins of power in the country.
Shahbaz Sharif also held a meeting with Qatari Prime Minister and Interior Minister Sheikh Abdullah bin Nasser bin Khalifa Al Thani. Talks during the meeting dealt with bilateral relations and ways of strengthening them in addition to a number of issues of mutual interest.
Shahbaz Sharif is visiting Qatar as special envoy of Prime Minister Nawaz Sharif to officially convey the country’s felicitations over Qatar’s peaceful transition of power.
The high-level Pakistani delegation includes Federal Minister for Petroleum Shahid Khaqan Abbasi and Federal Minister for Water and Power Khawaja Mohammad Asif. According to reports from Doha, the delegation has on its agenda a breakthrough in the volumes and pricing formula for LNG imports from Qatar.
One of the main challenges faced by the newly-elected Pakistani government is the severe energy crisis in the country. When the delegation meets Qatari leadership, including the Minister of Energy and Industry Dr Mohamed bin Saleh al-Sada, the talks are expected to focus on how Qatar can facilitate Pakistan, especially in the form of better LNG price formula.
“We don’t expect a breakthrough and a deal to be signed immediately, but we hope to see a major step forward in our talks over the LNG import issue,” a senior Pakistani official said.
The Petroleum Ministry reportedly wants to negotiate the import of 500mmcfd LNG from Qatar. In March 2013, Qatar had offered to provide 250mmcfd to Pakistan at $17.437/mmbtu.
However, the main challenge for Pakistan was the absence of the infrastructure necessary to receive and relay LNG in Pakistan, which the Qatari offer did not include.
With the infrastructure cost of at least $200mn factored in, the Qatar LNG price formula reportedly works out at $19.521/mmbtu.
For this reason alone, the Pakistani delegation was expected to face an uphill task in explaining why Qatar should sell gas to Pakistan at a lesser price given that it could get good market prices by selling it to countries that already had an LNG infrastructure.
This is the first high-level visit from Pakistan since the May 11 general elections in which Nawaz Sharif’s Pakistan Muslim League emerged victorious. Sources say that the Sharif
family historically have had ‘very close relations’ with the ruling family of Qatar and they hope that due to this ‘key factor,’ the new Pakistani government would have a better chance of making a breakthrough than its predecessor, the Pakistan People’s Partly-led government.
