In a deft energy-market manoeuvre, Pakistan has transformed an oversupply of liquefied natural gas (LNG) into a financial triumph, securing an estimated USD 880 million in combined savings and profits through a three-year deal with Italian energy major Eni S.p.A.

Under the arrangement, Pakistan LNG Limited (PLL) will divert 32 LNG cargoes from the domestic grid to the international market between 2025 and 2027, capitalizing on lower local demand and higher global spot prices.

It has been reported that the two transmission companies – Sui Northern Pipelines Ltd and Sui Southern Pipeline Ltd – had been reporting that Pakistan’s gas transmission network had been under pressure, both literally and economically. With line-pack volumes often exceeding 5.2 billion cubic feet (bcf) – a dangerous level for the system – authorities faced the dual challenge of managing excess regasified LNG (RLNG) or facing penalties for violating contractual terms.

Rather than allowing surplus gas to strain infrastructure, Pakistan was able to negotiate a mechanism within its long-term supply contract with Eni for diversion of cargoes outside........

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