Key Takeaways
- SNGPL has declared force majeure on regasified liquefied natural gas (RLNG) supply due to security concerns.
- The disruption is expected to affect power generation in Punjab for nearly three weeks.
- Higher electricity costs and increased loadshedding are anticipated if the situation persists.
Pakistan’s Sui Northern Gas Pipelines Limited (SNGPL) has declared force majeure on regasified liquefied natural gas (RLNG) supply, citing ongoing security concerns around the Strait of Hormuz. This development is expected to impact RLNG supplies to Punjab for nearly three weeks and could lead to increased power shortages and higher electricity generation costs.
According to SNGPL, Pakistan State Oil (PSO) informed the company that force majeure declared by its LNG supplier remains in effect due to the ongoing military conflict in the Gulf region. The disruption is expected to affect LNG cargo deliveries scheduled between July 14 and Aug. 3, limiting RLNG availability for power generation.
SNGPL issued separate notices to four RLNG-based power plants in Punjab, stating that its contractual obligations remain suspended because the disruption is beyond its reasonable control. The company said QatarEnergy, SNGPL’s supplier, has started gradually resuming operations but shipping through the Strait of Hormuz remains intermittent due to continued security risks.
QatarEnergy has also indicated it will not be able to deliver additional LNG cargoes planned under the Annual Delivery Plan 2026 during the affected period. The company expects to issue a revised delivery schedule for the remainder of the current contract year once operational conditions improve. The supply disruption could affect more than 5,000 megawatts of RLNG-based power generation in Punjab.
The gas utility warned that authorities may have to rely on imported LNG purchased from the more expensive spot market or operate power plants on diesel to bridge the supply gap, both of which would increase generation costs. Government officials said available LNG stocks may help reduce the immediate impact through rationing but cautioned that consumers could still face higher loadshedding or increased electricity costs if the disruption continues beyond Aug. 3.
SNGPL is closely monitoring the situation with PSO and will provide further updates as conditions evolve. The company stated, 'We are working to mitigate the impact of this disruption on our operations and ensuring that consumers are informed about any changes in supply.'
