Deal signed with ExxonMobil for supply of LNG to transport sector – Newspaper

HOUSTON: ExxonMobil Vice President Richard Rayfield and UGDC Executive President Ghiyas Abdullah Paracha sign the LNG supply agreement.

ISLAMABAD: ExxonMobil, the world's largest publicly traded oil and gas company, signed an agreement on Wednesday with Universal Gas Distribution Company (UGDC) to supply liquefied natural gas (LNG) to the country's transportation sector.

"After the agreement, the first shipment of LNG is expected for next month, which will change the entire gas landscape in Pakistan," said a statement issued by the Petroleum Division of the Ministry of Energy.

The agreement was signed in Houston, Texas, by ExxonMobil Vice President Richard Rayfield and UGDC Executive Director Ghiyas Abdullah Paracha and witnessed by the Special Assistant to the Prime Minister of Petroleum, Nadeem Babar. A large government delegation is currently in the United States to attend an annual LNG conference.

Paracha said the agreement initially covered four charges in the first year that would gradually increase overtime depending on the revival of the CNG sector. He said the first shipment was being organized by the end of October for which a legal framework already existed and that the prime minister had focused heavily on the Ease of doing business to revive investor confidence.

CNG will become cheaper by 30{7be40b84a6a43fc4fae13304fce9a2695859798abfc41afd127b9f8b21c5f9c5}; first shipment due next month

He said the agreement would allow the sale of CNG at least 30 percent cheaper than the price of gasoline. "Based on this price differential, we expect two million new vehicles to be converted to CNG in two years," he said, adding that this would generate savings on the import bill of about $ 1 billion a year.

The Petroleum Division said the agreement "for the first time would result in the importation of private LNG into the country" and "the first shipment of LNG expected for next month will change the entire gas landscape in Pakistan."

Special Assistant to the Prime Minister of Petroleum, Nadeem Babar, President of LNG Market Development Alex Volkov, President of ExxonMobil Market Development, Irtiza Sayyed, Pakistan Country Manager ExxonMobil Shahrukh Mirza, senior officials of the Ministry of Petroleum and UGDC also They were present on the occasion.

Speaking at the event, Babar said this was a historic moment since ExxonMobil had decided to invest in Pakistan after a 20-year gap. He said the companies would receive an enabling environment according to the vision of Prime Minister Imran Khan.

He said the agreement was an honor for Pakistan and that the government will promote the ease of doing business to facilitate investment in all sectors, including the energy sector.

He said the government wanted to exit the import of gas and this agreement was the first step in that direction. ExxonMobil's investment will also encourage other energy companies to invest in Pakistan, which will reduce the price of gas to help the masses and the environment, he added.

Alex Volkov and Irtiza Sayyed said their company had decided to invest in Pakistan after two decades with the vision of providing economical and ecological gas to consumers on a regular basis. "We will support UGDC so that it can overcome the gas shortage in Pakistan," Volkov said.

Ghiyas Paracha said the government had changed the rules of third parties to allow the private sector to import gas that would help the CNG sector to buy surplus gas from the terminals and also buy the fuel from the next five terminals that will revive the CNG sector.

Posted on Dawn, September 19, 2019

Source: https://www.dawn.com/news/1506032/deal-signed-with-exxonmobil-for-supply-of-lng-to-transport-sector

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