Pakistan has decided to advance negotiations with Qatar over its long-term LNG supply agreements, as a price reopening clause is set to be triggered in March 2026. The move comes amid a deepening surplus crisis, caused by power sector defaults that have led to underutilization of imported gas and forced cargo diversions to the international market. A high-level delegation, led by Petroleum Minister Ali Pervaiz Malik, will visit Qatar by end-August to discuss rescheduling cargo deliveries and future pricing terms. Officials warn that delaying talks could worsen the LNG glut, with five deferred 2025 cargoes set to arrive in 2026.
Pakistan imports 9 LNG cargoes monthly from Qatar under 15-year and 10-year contracts, primarily to fuel Punjab’s RLNG power plants. However, the power sector’s failure to meet contractual usage has led to dangerously high pressure in the national gas network. As of August 3, 2025, pipeline pressure reached 5.170 bcf—beyond the critical 5 bcf danger mark, risking system failure. To mitigate risks, authorities have shut down 350-400 mmcfd of local gas wells, exacerbating supply inefficiencies.
While ENI-supplied LNG cargoes are being diverted and resold internationally (with profits shared between ENI and Pakistan LNG Limited), Qatar’s contracts are less flexible. If Qatar diverts Pakistan’s cargoes, profits are not shared, and losses fall entirely on Pakistan. The government hopes to renegotiate terms ahead of the 2026 price revision, potentially reducing import volumes and adjusting prices based on global market trends.
With the power sector’s non-compliance worsening the LNG surplus, Pakistan faces financial and operational strains. The upcoming talks with Qatar aim to stabilize future supplies and prevent further losses. Failure to secure favorable terms could heighten energy insecurity, forcing Pakistan to bear unaffordable costs amid an already fragile economic recovery. The outcome of these negotiations will be critical for Pakistan’s energy stability in the coming years.
