Pakistan received a significantly cheaper bid in March for the supply of three cargoes of liquefied natural gas (LNG) as part of an immediate tender process following falling prices in the international market.
The state-run Pakistan LNG Limited (PLL) cancelled bids for three windows of LNG supply in March last week as prices began to fall in the international spot market, Dawn reported. For the replacement, PLL received a revised instant tender on January 22 with a deadline of January 26. Revised bids were received at 26% to 38% cheaper rates than cancelled bids.
According to the results obtained from PLL, Brent received the lowest bid of 13.62% from Italy’s ENI for the second week of March, compared to 22.24% of the same company’s Brent for cargo delivery. This represents a decrease of about 38% in one week. ENI also emerged as the lowest bidder for cargo in the third week of March, when Vitool had the lowest bid of 17.81% for the same delivery window, showing a lower rate of 23.5%. The lowest bid for the fourth week of March was received from Qatar Petroleum at 12.73 percent of Brent, compared to 17.19 percent by Vitol in the previous bid, a decrease of 26 percent.
The revised instant tendering also attracted more bidders, with a total of 20 bids received for three delivery windows, up from a total of 12 bids previously, indicating a decline in demand over the past two weeks. Later, prices in the spot market are falling. Under the previous bids, the revised rates were between 6. 6.6 and 7. 7.2 per MMBtu, compared to 8. 8.9 per MMBtu. This shows that ever since Emirates National Oil Company defaulted on its supply bid for February when spot prices hit the highest level, Qatar Petroleum’s participation has been a source of bid reduction for Pakistan.
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