Pakistan's LNG Supply Cut Threatens Industrial Output

The suspension of liquefied natural gas (LNG) supply to Pakistan by Qatar until November 5 has sent shockwaves through the industry, according to Mian Zahid Hussain, President of the Pakistan Businessmen and Intellectuals Forum (PBIF).

Hussain explained that Qatar's decision is based on the 'force majeure' clause, which excuses parties from fulfilling contractual obligations in cases of natural disasters or unavoidable emergencies.

The disruption is particularly significant given that Qatar supplies 20 percent of the world's LNG and that Pakistan relies heavily on imported gas to meet its energy needs.

Pakistan's average annual demand for natural gas and imported LNG has hovered between 1.27 and 1.46 trillion cubic feet (TcF) over the past five years, but actual consumption has been restricted to around 1.1 to 1.2 TcF annually due to gas rationing and pipeline constraints.

Hussain warned that industries in Pakistan are already struggling with high production costs, and the anticipated cuts in LNG supply will force them to scale down production even further.