This was specified in para 8.4.1 of the 89 page of purported Liquefied Natural Gas (LNG) deal signed on 10 February 2016 between Pakistan State Oil (PSO) and Qatar Gas in Doha which was said to be blacked out on the PSO website due to a confidentiality clause (para 25.1). The deal was signed while former Prime Minister Nawaz Sharif and the then Petroleum and Natural Resources Minister and the incumbent Prime Minister Shahid Khaqan Abbasi stood by and is being cited as a scam bigger than the rental power plants with members of the Opposition committing to take the matter to court.
Also 'blacked out' on the PSO website were portions of para 8.1.2 which states: "The buyer may request no later than 15 days prior to loading date the sellers consent to take delivery of the relevant cargo at the receiving terminal other than the Elengy import terminal....the seller shall provide its consent (such consent not to be unreasonably withheld or otherwise to delivery to the alternate receiving terminal as soon as reasonably practicable." Elengy is the only LNG receiving terminal in Pakistan today operated by Engro (ownership of Dawood group); however another terminal is under construction by a consortium of Gasport (sole owner Iqbal Z Ahmed) and Fauji Foundation - the latter had also applied separately but failed to meet the tender's specifications. The scheduled completion date of this second terminal was June 2017 but is now rescheduled for completion in December 2017.
Qatar Gas shall determine the amount by which the quantity of LNG expected to be delivered pursuant to Annual Delivery Programme was over or under estimated as a result of deviation in standard cargo content. Adjusted annual upwards/downward contract quantity (ACQ) will be in accordance with the Buyer requesting (i) 2 additional cargoes for delivery in any contract year having an ACQ of less than 195,000,000 mmbtu (or approximately 3.75 million metric tons) of LNG and (ii) three cargoes in any contract year where the ACQ is equal to or greater than 195,000,000 mmbtu by notifying the seller...no later than 1 October of the year preceding and not less than 90 days prior to requested delivery. (paras 7.1 and 7.2 )
With respect to upward/downward ACQ the cumulative downward flexibility quantity (CDFQ) shall not exceed six cargoes. At no time during the supply period wherein the ACQ is less than 195,000,000 mmbtu of LNG shall the CDFQ exceed four cargoes. The buyer shall not request Annual Downward Flexibility Quantity in respect of the last two contract years or - 2030-31. para 7.2.5
If prior to 1 October and ending on 15 November the buyer notifies the seller that it is unable to take delivery of a cargo during the following contract year and provided that such cargo is not scheduled to commence loading during the first 15 days of the following contract year [the seller shall try to find an alternate party and invoice the buyer the difference]. Para 7.3.2
The cargoes when delivered shall be designated accordingly (a) the Adjusted Annual Contract Quantity (excluding Annual Make-Good Quantity and Annual Upward Flexibility Quantity) and (d) Annual Upward Quantity Flexibility if any has been requested by the buyer and accepted by the seller. Para 9
If the LNG supplied is not within the agreed specification the buyer and seller shall consult and use all reasonable endeavours to agree on an appropriate (on a temporary or permanent basis) the buyer takes delivery of such LNG all costs including those incurred by the two gas utilities (SNGPL and SSGPL) will be up to a maximum aggregate amount of 2 0 percent of the contract price; and where neither the buyer nor the seller are aware that the cargo does not comply with specifications then the buyer will be entitled to a maximum aggregate amount of 25 percent. (paras 13.2.1 and 13.2.2).
Port charges (defined as any port charges loading and unloading) in excess of US$ 320,000 shall be for the Buyer's account provided that the Seller shall initially pay all required port charges including those in excess of US $ 320,000 and the Buyer will reimburse the seller for any such excess amount.
Maximum lay time allowed for unloading of each cargo shall be 48 hours para 11.7.2
Business Recorder has already published the blacked out contents of the agreement uploaded on the PSO website relating to contract price, contract price review, payment, and stand by letter of credit on 25 September 2017.
Copyright Business Recorder, 2017