Cement exports drop slightly
Total year-on-year cement dispatches in August fell from 2.283 million tonnes to 2.251m tonnes, All Pakistan Cement Manufacturers Association said in a statement. Exports from the north declined from 0.512m tonnes to 0.438m tonnes during the month compared with last year. However, domestic cement market in the region registered a little increase, dispatching 1.312m tonnes against 1.287m tonnes during the same month last year. Local cement dispatches from the south dropped by 11.65 per cent while exports increased by 15.48 per cent. The exports from South in August last year were 0.188m tonnes that increased to 0.239m tonnes this year. Local sales declined from 0.296m tonnes to 0.239m tonnes. The statement said the manufacturers came under pressure because of recent hike in power tariff and fuel prices which, in turn, raised the input and transportation costs.
SBP’s reserves fall to five-year low at $4.8 billion
Foreign exchange reserves of the State Bank of Pakistan (SBP) went below $5 billion – their lowest level in five years - for the week ended August 30, the SBP’s data said on Thursday. Reserves held by the State Bank declined to $4.822 billion from $5.203 billion, while country’s total liquid foreign reserves fell to $9.998 billion from $10.390 billion during the previous week. Economists said the major reason for the decline is the country’s need to fulfill its external debt servicing obligations. Pakistan paid the 19th installment of $393 million to the International Monetary (IMF) as part of loan repayment on August 26th. The central bank’s forex holdings are now one of the lowest since 2008. This was the year (November, 2008) when Pakistan signed $7.6 billion worth of stand-by arrangement loan program agreement with the IMF to overcome its severe balance of payments difficulties. The Fund said at that time that the loan was given with a view to strengthen Pakistan’s sharply diminishing foreign exchange reserves.
Tullow Oil winding up Pakistan operations
Ireland based oil/gas Exploration and Production (E&P) company Tullow Oil Plc is to wind up its Pakistan operations. In March 2012 the company took the decision to commence a process to sell its Asian assets to focus on its core African and Atlantic margin strategy. British Petroleum (BP) and Malaysian-based firm Petronas have already wrapped up their operations in Pakistan. Tullow Oil is the third foreign firm seeking to liquidate its assets and leave the country. Pakistan Petroleum Limited (PPL) had shown interest in acquiring the assets of Tullow in Pakistan and Bangladesh but later it gave up on its plan as Tullow sold its Bangladesh assets to a Singapore-based company, Kris Energy. A PPL official said the state-owned company is no more interested in Tullow Oil's remaining assets. In December 2012, after receiving formal approval from the federal government, PPL appointed consultants to evaluate Tullow Oil's assets in Pakistan and Bangladesh to determine hydrocarbon potential and the possible advantage of each block. Tullow has been active in Pakistan since 1991 and has exploration, development and production interests across seven licenses covering 13,171 sq kms. Early in 2010, Tullow successfully completed the Shekhan-1 exploration well encountering 45 meters of net gas pay.
Plan prepared to import LNG under $490 million projects
The government has prepared a plan to import LNG under $490 million short, medium and long-term projects. LNG import projects are expected to be implemented within the next two to three years with the objective of enabling the country to import 1.7mmcfd LNG to alleviate the gas crisis in the country. The government intends to import 200mmcfd gas through a fast track Engro terminal Project in the next six to eight months at a cost of $30 million to $40 million. The Engro Vopak Terminal Limited (EVTL) would provide the project cost. The project activities include retrofitting of existing Engro LPG terminal, provision of Floating Storage and Re-gasification Unit (FSRU), dredging and laying of 8 kilometres pipeline from terminal to SSGC receiving point. The EVTL will be the terminal operator under a tolling arrangement. A fixed per mmbtu tolling fee and annual throughput guarantee will be negotiated. The timeline for completion of the project is six to eight months from award of contract. The supply will be intermittent and twice a month for 5-6 days each of 200 mmcfd LNG each day. The ship movement and night navigation issues would be resolved with Port Qasim Authority. The plan also envisages import of 500mmcfd LNG through SSGC LPG Retrofit Project within the next 18 to 22 months. The financing cost of the project $175 million to $200 million would be provided by the successful bidder.