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Category: Energy

You can go through stories related to energy. The stories are about changes in petroleum prices and updates on energy sector of Pakistan and world.

  • PSO issues clarification LNG purchase

    PSO issues clarification LNG purchase

    KARACHI: Pakistan State Oil (PSO) has clarified reports about purchase of Liquefied Natural Gas (LNG) on higher prices.

    In a statement on Sunday the company clarified that:

    No cargo from long-term supply contract in September has been dropped or canceled by PSO as reported by certain media outlets. As per the Annual Delivery Plan (ADP) agreed with all stakeholders, 04 cargoes were to be supplied under the long-term contract in the month of September and 02 spot deliveries were planned.

    PSO’s long-term contract for 60 cargoes a year is not equally divided over 12 months. PSO prudently planned winter (Jan-Feb & Nov-Dec) in advance, when spot prices are usually higher, and arranged 28 cargoes instead of 20 under the long-term contracts -24 cargoes from the existing long-term contract and 4 additional cargoes from the recently executed long-term contract commencing in January 2022 by exercising contractual rights. This has been planned to meet the ever-increasing gas demand in winters at the lowest possible rates.

    PSO has enabled considerable savings through effective planning and contract management by reducing the number of spot cargoes from 12 to 6 this year using contractual flexibilities available while maximizing long-term cargoes through contracts from 60 to 70.

    As far as the timing of the tenders is concerned, awarding cargoes ahead of the required delivery windows or awarding a strip of cargoes in one go does not suit PSO since the company has certain contractual flexibilities available under long-term contracts and spot purchases are very few in a year as mentioned above. For e.g. due to the unplanned Dry Dock activity of FSRU in Jun-Jul and uncertain situation in September considering scheduled FSRU replacement, had PSO awarded July and September spot cargoes in advance, the company would have had to either drop much cheaper contractual cargo or face Take or Pay penalty. Therefore, spot purchases are finalized after carefully seeing the demand-supply dynamics and market conditions.

    The bids received against the required deliveries in September 2021 are yet to be awarded by PSO. As per procedure, the received bids will be presented to the company’s Board of Management along with the supply/demand situation & global price trends and a decision will be arrived at accordingly.

    Considering that 2021 has seen exceptionally high LNG prices in international market, the planning and management of contract done by PSO will not only absorb the impact of higher spot prices but also result in potential savings. As the national flag bearer, PSO is committed to safeguarding national interest and leaves no stone unturned to fuel the country’s progress.

  • ECC approves continuation of subsidy to export sector

    ECC approves continuation of subsidy to export sector

    ISLAMABAD: The Economic Coordination Committee (ECC) of the Cabinet on Monday approved continuation of subsidy on supply of gas and electricity to export sector.

    Finance Minister Shaukat Tarin presided over the ECC meeting. The ministry of commerce gave a detailed presentation for continuation of reduced rates of electricity and RLNG to export oriented sectors.

    Secretary commerce briefed the Committee that extension of concessional rates of electricity and RLNG is important for sustained increase in exports by providing energy at regionally competitive rates.

    After due deliberations, the committee approved the continuation of electricity and gas subsidy for export-oriented sectors to support the momentum of growth in exports during the FY 2021-2022.

    The finance minister emphasized the need to incentivize export-oriented sectors in order to take our exports to the next level. He also stressed the need to rationalize usage of energy inputs. For this purpose, the ECC constituted a sub-committee comprising Minister for Energy, Minister for Industries & Production, Advisor on Commerce, Deputy Chairman Planning Commission, Additional Secretary (CF) Finance Division and other relevant officials for presenting a plan to resolve the issue of continued use of gas by some units for power generation and non-cooperation in audit of such use.

    The sub-committee was directed to present its recommendations before ECC within 30 days for further deliberation.

    The ECC considered and approved a summary presented by the Power Division for extension of incremental consumption package for K-Electric industrial consumers of X-WAPDA DISCOs & K-Electric and application of incremental consumption package for BI(Non ToU) consumers of X-WAPDA DISCOs and K-Electric at the rate of Rs.12.96/kwh from 1st July 2021 to 31st December 2021.

    The cabinet committee approved another summary by the Petroleum Division regarding NOC for issuance of the Parent Company Guarantees/Corporate Guarantees by each of the consortium companies, on a joint and several basis, in favour of ADNOC and SCFEA to pursue international exploration and production opportunity in Abu-Dhabi, United Arab Emirates.

    Federal Minister for Privatization Muhammad Mian Soomro, Federal Minister for National Food Security & Research Syed Fakhar Imam, Federal Minister for Industries and Production Makhdoom Khusro Bakhtiar, Federal Minister for Energy Muhammad Hammad Azhar, Federal Minister for Economic Affairs Division Omar Ayub Khan, Adviser to the PM on Commerce Abdul Razak Dawood, Adviser to the PM on Institutional Reforms and Austerity Dr. Ishrat Hussain, SAPM on Finance and Revenue Dr. Waqar Masood, SAPM on Power & Petroleum Tabish Gauhar, Federal Secretary Finance, Secretary M/o Industries and Production, Secretary M/o NFS&R, Secretary Power, Secretary Petroleum, Chairman FBR and other senior officers participated in the meeting, Governor SBP Dr. Reza Baqir also participated through video link.

    SBP to launch rewards for inward remittances
  • Prices of kerosene oil, LDO increased for next fortnight

    Prices of kerosene oil, LDO increased for next fortnight

    ISLAMABAD: The government has increased the prices of kerosene oil and Light Diesel Oil (LDO) for next fortnight effective from August 16, 2021.

    The prices of kerosene oil have been increased by Rs0.81 per liter, from Rs87.49 to Rs 88.30.

    Likewise, the prices of Light Diesel Oil (LDO) have been increased by Rs1.10 per liter from Rs84.67 to Rs85.77.

    However, the government kept prices of petrol and diesel unchanged with effective form August 16 for next fortnight.

    According to press statement issued by the Finance Ministry, the sale of petrol would continue on Rs119.80 till August 31st.

    Likewise, prices of High Speed Diesel (HSD) would remain unchanged at Rs116.53 per liter.

    FBR reduces sales tax rate on petrol to 10.77%
  • PM directs finalizing tight gas policy by next month

    PM directs finalizing tight gas policy by next month

    ISLAMABAD: Prime Minister Imran Khan on Thursday directed authorities to finalize Tight Gas Policy by end of September 2021.

    The prime minister chaired a meeting to discuss the tight gas resources.

    The meeting was attended by Federal Ministers Shaukat Fayyaz Tareen, Hamad Azhar, Asad Umar, Special Assistant Tabish Gohar and concerned senior officials.

    The meeting discussed in detail the potential resources of Tight Gas in the country.

    The meeting was informed that Pakistan is expected to have huge reserves of tight-gas. These reserves could help reduce the country’s dependence on expensive imported LNG.

    The prime minister directed that the Tight Gas Policy be reviewed and finalized by the end of September 2021.

  • FBR reduces sales tax rate on petrol to 10.77%

    FBR reduces sales tax rate on petrol to 10.77%

    In a move aimed at providing relief to consumers, the Federal Board of Revenue (FBR) has announced a reduction in the sales tax rate on the supply of petrol. The new rate, effective immediately, is set at 10.77%, down from the previous rate of 16.40%.

    (more…)
  • Pak Oxygen invests Rs2.5bn for ASU setup

    Pak Oxygen invests Rs2.5bn for ASU setup

    KARACHI:  Pakistan Oxygen Limited on Monday announced to set up an Air Separation Unit (ASU) with an amount of Rs2.5 billion.

    The company will set up the unit in the northern of Pakistan. This is company’s fifth ASU plant in the country.

    The board of directors of the company approved the investment plan on July 16, 2021. The investment will meet the growing demand of Oxygen in the country. It will meet demand from healthcare and industrial segments.

    The company hoped new plant to come on stream by 2023. It made efforts to meet demand for COVID-19 patients. The company will install ASU plant in Khyber Pkhtunkwha province. The new ASU shall serve the various CPEC related projects in Khyber Pakhtunkhwa province.

    The company approved around Rs10 billion. The largest investment of this is Rs6.3 billion for under construction plant at Port Qasim Karachi.

    The company has three ASU plants in two major cities. These ASU plants have combined capacity of 263 tons per day.

    In February this year company announced investment of Rs417.5 million to set up European technology electrode manufacturing in Karachi.

    Pakistan Oxygen Limited is a leading supplier of industrial and medical gases. It provides pipeline services and welding solutions.

  • Mari Petroleum signs exploration agreement

    Mari Petroleum signs exploration agreement

    KARACHI: Mari Petroleum Company Limited (MPCL) on Monday announced that it has executed a farm-in agreement.

    The company signed the with MOL Pakistan Oil and Gas Co. B.V. for acquisition of significant working interest in Margala Block. The company signed the deal to collaborate resources and efforts to jointly perform exploration activities.

    The Block is situated in the Potwar Basin in the vicinity of Islamabad. The assignment of working interest shall be subject to Government approval.

    This farm-in is part ofMPCL’s aggressive strategy not only to increase its exploration acreage, reserves replacement ratio and maximizing shareholder’s value. it will also meet Country’s increasing energy demand from indigenous resources and lowering the burden of imported fuels on national economy.

  • POL prices increased for next fortnight; per liter petrol up by Rs5.4 to Rs118.09

    POL prices increased for next fortnight; per liter petrol up by Rs5.4 to Rs118.09

    ISLAMABAD: The government on Thursday announced increase in petroleum prices to be implemented midnight with effect from July 16, 2021 for next fortnight.

    The government announced an increase of Rs5.4 to Rs118.09 in price of petrol from Rs112.69.

    Likewise, the prices of high speed diesel increased by Rs2.54 per liter, from Rs113.99 to Rs116.53; kerosene oil by Rs1.39 per liter, from Rs85.75 to Rs87.14 whereas the price of light diesel oil increased by Rs1.27, from Rs83.40 per liter to Rs84.67 per liter.

    The Oil and Gas Regulatory Authority (OGRA) had recommended Rs11.50 increase in per liter petrol, however the Prime Minister, considering to provide maximum relief to the public allowed only Rs5.4 liter increase, said a press statement issued by the Finance Ministry here.

    In this way, the government observed Rs6.10 price hike in the commodity, it added. “The government has been providing maximum relief to the consumers by reducing the price of the petroleum products since April 2021,” it added.

    The statement said that although the international oil prices have been on rise, the government took the decision not to pass on the entire burden of increase to the consumers.

    The rates of sales tax and petroleum levy have been adjusted in a manner that maximum relief is provided to the consumers.

  • FBR drafts rules for warehousing, export of POL products

    FBR drafts rules for warehousing, export of POL products

    ISLAMABAD: The Federal Board of Revenue (FBR) has drafted rules for bonded warehousing and export POL Products.

    The FBR issued SRO 872(I)/2021 on Friday and proposed amendments to Customs Rules, 2001. The FBR invited recommendations on the draft rules from stakeholders before finalizing the rules to make part of the law.

    Following new rule 363A has been suggested regarding bonded warehousing and export of POL products:

     (1) The owner may store any imported POL products in a warehouse and export the same in accordance with rules 363A to 363F.

    (2) At the time of arrival of goods at a port, the owner shall file goods declaration through WeBOC system for in-bonding of the imported POL products submitting the documents as required under the Act.

    (3) The securities in the shape of postdated cheques and indemnity bond furnished by the owner under section 86 of the Act, at the time of warehousing of POL products, shall continue to be in force notwithstanding the transfer of the goods to any other person or firm unless the warehoused POL products are exported by way of supply to conveyances as provisions and stores as provided in section 106 of the Customs Act, without payment of any duties, taxes or levies, as the case maybe.

    Explanation / Note: Since the POL products, to be imported under this scheme, will be shipped or supplied without foreign exchange remittances from Pakistan, on account of cost of goods at the time of their imports, therefore, no Electronic Import Form (EIF) shall be required at the time of filing of GD for their in-bonding. Similarly, no EIF shall be required at the time of export. The owner of any POL products, warehoused in accordance with the foregoing provisions of this rule, may export such POL products as provisions and stores for conveyances proceeding to any foreign territory including by way of direct sale or sale through a third party.

    Explanation / Note: ‘direct sale’ — means that owner makes a direct sale to the owner or charterer of the conveyance and deliver the POL products to such conveyance. ‘Sale through a third party’ — means that the owner will:

    (i) issue sales invoice to a foreign entity other than the owner or charterer of the conveyance; and

    (ii) deliver POL products to a conveyance on the instructions of such foreign entity.

  • Petrol price increases by Rs2 to Rs112.69/liter

    Petrol price increases by Rs2 to Rs112.69/liter

    ISLAMABAD: The government on Wednesday announced an increase in price of petrol by Rs2 to Rs112.69 per liter from Rs110.69 with effect from July 01, 2021.

    A statement said that the price of high speed diesel (HSD) has been increased by Rs1.44 to Rs113.99 per liter from Rs112.55.

    The price of kerosene oil has been increased by Rs3.86 to Rs85.75 per liter from Rs81.89.

    Similarly, the price of light diesel oil has been increased by Rs3.72 to Rs83.40 per liter from Rs79.68.

    The statement said that in order to provide maximum relief to the consumers, the government has maintained the practice of keeping the prices of petroleum products at an affordable level.

    OGRA has been recommending substantial increase in the prices of Petroleum products since 1st May 2021, corresponding to the increase in prices of the petroleum products in the International markets.

    However, keeping in view the welfare of the general public, the government has absorbed the impact of the increase by making adjustments in sales tax and petroleum levy.

    Currently, the petroleum levy rates are at the lowest of last six years.

    During the financial year 2020-21, the government has provided Rs252.41 billion subsidy to the consumers by keeping low the petroleum levy rates against the budgeted Rs. 30/liter on all products.

    It is also worth mentioning that as compared to our regional neighbours, Government of Pakistan is providing Petrol and Diesel at the lowest level rates.