LNG Distribution Plans Infrastructure Development - … Seminar - 11012015 (Final Presentation).pdf · LNG Distribution Plans & Infrastructure Development Pakistan Institute of Petroleum

Sui Northern Gas Pipelines Limited

LNG Distribution Plans

&

Infrastructure Development Pakistan Institute of Petroleum

January 11th, 2016 Kashif Siddiqui

General Manager, LNG-LPG

Sui Northern Gas Pipelines Ltd. [email protected]

1


CONTENTS

2

Pakistan’s Energy Mix

Pakistan’s Natural Gas Supply-Demand Projections

Imbalance of Demand-Supply on SNGPL’s Network

Demand-Supply Imbalance – Hit to Economy

RLNG – Lifeline for the Economy

Allocation of RLNG to Consumers on SNGPL’s Network

Sector-wise Consumption of RLNG on SNGPL’s Network

LNG Imports Transaction Structure

SNGPL’s System augmentation for upcoming LNG Supply

Supply of Gas to RLNG based 4000 MW Power Plants

Sui Northern Gas Pipelines Limited 3

Oil

35%

Natural Gas

46%

LPG

1%

Coal

5%

Electricity

13%

Source: Pakistan Energy Yearbook 2014

Pakistan’s Energy Mix


Natural Gas Supply-Demand Projections


Demand Supply Imbalance – SNGPL Network

5

2012-13 2013-14 2014-15 2015-16

1603 1476

1258 1157

2320 2470 2380

2541

717

994 1122

1384

System Input Demand Shortfall

MMCFD

Natural depletion of existing gas fields and NO addition of major indigenous gas source

Increase in gas demand on account of expansion in network every year, which results in addition

of 30~40 MMCFD load during summers and 80~100 MMCFD load during winters

This shortage persists despite MORATORIUM on new Industrial & Commercial connections

since 2011


Winter Increase in Demand (Nov. – Feb.)

6

2013-14 2014-15 2015-16

1468 1261

1151

2665 2654 2809

1197 1393

1658

MMCFD

System Input Demand Gap

• The gap between demand and supply is bridged through massive curtailment in Punjab province in all

consumer categories except domestic and commercial consumers on year round basis

• Total demand of Khyber Pakhtunkhwa (KP) to be met due to decision of Peshawar High Court on

Article-158 of the Constitution, till the time the demand does not exceed the supplies from sources in KP


LOST OPPORTUNITY SNGPL’s Operational Infrastructure

Gas Sources

• 39 Gas Sources

Compression

• 216,000HP

• 11 Compressor Stations

Transmission

• >7,800 Km

Distribution

• > 100,000 Km

• > 3200 Towns & Villages

Consumers

• > 5.0 Million

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• Gas supplies were discontinued to consumers where GSAs for firm supply have

expired. These include consumers from Power and Fertilizer sectors.

• Resultantly, power generation capacity of around 2284 MW either goes idle or shifted

to more expensive Liquid Fuels.

• Massive investment made in Fertilizer Sector went astray.

• Further, gas supply to CNG Sector (demand 300 MMCFD) in Punjab, has remained

suspended since November 2014.

• Resultantly, the billions of rupees worth investments incurred on around 2,300 CNG

Stations and the massive capital put in by all CNG fitted vehicle owners went idle.

The bread and butter of people associated was adversely hit.

• Additionally, with the onset of winters this year, gas supplies to Industrial sector

(demand 563 MMCFD) across Punjab were also suspended, in order to ensure

maximum availability of gas for highest priority Domestic and Commercial sectors.

• The costs of energy input raised manifold for the industrial units in Punjab, thereby

resulting in financial losses, decrease in textile exports and threat of unemployment !

8

Demand Supply Gap - Hit to the Economy


• LNG imports have been materialized and first flow of Re-gasified LNG

(RLNG) was injected into SNGPL’s network on March 27, 2015.

• Power Sector

Power generation capacity of 2284 MW was brought back into production or

switched from expensive liquid fuels to RLNG.

• Industrial Sector

Over 500 industrial units (mainly export-oriented textile sector) have been

revived during winters to whom gas supplies were suspended.

• CNG Sector

Around 750 CNG stations across Punjab operated even during the month of

December for the first time in many years.

• Fertilizer Sector

Production of fertilizer re-initiated thereby contributing massively to the

agriculture economy of the Country.

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Sectors Before LNG Imports

Current Scenario

(Nov-Dec 2015)

Power 42 MMCFD 129 MMCFD

Fertilizer 4 MMCFD

(Operational for 7 days only

during 4 months)

40 MMCFD (Operational for all 61 days of

Nov-Dec 2015)

General Industry Nil RLNG offered and individual

customers are adding...

Textile* 4 Hrs for Captive and

17% for Processing

4 Hrs and 17% on RLNG

w.e.f. 25.12.2015

CNG Nil 9 days

* Despite reduction in input by around 150 MMCFD and addition of demand by 90 MMCFD,

supplies to Industry continued this winter at par with last year supplies, only due to injection

of RLNG in SNGPL’s system.



LNG Allocations

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POWER

FIRM COMMITMENT MMCFD

250 MW LNG fired Power Plant of M/s Davis Cogen (Pvt.) Ltd 50

1200 MW Balloki Power Project 200

1200 MW CCPP Bhikhi 200

1200 MW Haveli Bahadur Shah 200

425 MW Combined Cycle Power Project Nandipur 100

Rousch 85

AS AND WHEN AVAILABLE

FKPCL 24

HALMORE POWER 40

ORIENT POWER 40

SAIF POWER 40

SAPHIRE POWER 40

KAPCO 140

FERTLIZER

56

CNG

CNG

INDUSTRY

Textile Industry @ 4 Hrs for Captive and 17% for Processing 60

Other Individual Industrial Consumers 100


LNG

Suppliers PSO

SSGC

(Local

Buyer)

SNGPL

(Local

Buyer)

EETL

(Terminal

Operator)

SSGC SNGPL

SPA

(Long Term)

MSA

(Spot/Short Term)

Tripartite

Agreement

LSA

GTA

GSAs with

RLNG

Consumers

Re-gasification

Contract

LNG IMPORTS TRANSACTION STRUCTURE


Scope of Responsibilities

• PSO: Procure LNG, both Long Term (SPA) and Short Term

(MSA) LNG ; and on-sell it right at shore to SSGC and

SNGPL according to their allocations (currently 100%

for SNGPL)

• SSGC: Make LNG available to EETPL for its own as well as

SNGPL share for Storage & Re-Gasification

• EETPL: Receive, store, and re-gasify LNG under LSA with

SSGC; and deliver RLNG into SSGC network

• SNGPL: Receive RLNG from SSGC (through swap

arrangement initially) and sell it to designated buyers

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SYSTEM AUGMENTATION FOR LNG SUPPLY

AUGMENTATION PLAN

SNGPL has prepared an augmentation plan of its system

downstream Sawan (Sawan is starting point of SNGPL

pipeline system which is located in District Khairpur

Province Sindh) to receive additional LNG supply up to

1.2 BCFD on the basis of two Projects under the

nomenclature i.e. Project-1 & Project-2.



Objective Transportation / receiving of additional 400 MMCFD

LNG Supply into Company’s system

Infrastructure

Involved

a- 42”dia x 111.355 KM Pipeline from Sawan to Qadirpur

(Qadirpur is located in District Ghotkhi, Province Sindh)

b- 5000 HP compression at AC1(X) Bhong

Estimated Project

Cost Rs. 18,543 million.

Project Approvals Project has been approved by our Board of Directors as well as OGRA.

Project Financing Syndicated term finance loan has been arranged from consortium of

eight banks.

Project Completion

date Nearing Completion.


PROJECT -1 MAP

GAS SOURCE

COMPRESSOR

STN.

EXISTING PIPELINES

PROPOSED PROJECT-1

(42”DIA. X 111.355 KM)

COMPLETED

16



Objective Transportation / receiving of 1200 MMCFD LNG including 400

MMCFD LNG of Project-1 into Company’s system.

Infrastructure Involved

a- 16” to 42” x 762 KM Pipeline

b- 25000 HP compression at AC1(X)

and AC 6 (Multan)

42” - 70 KM

36” - 303 KM

30” - 109 KM

24”-16” - 280 KM

Estimated Project Cost Rs. 57,941 million.

Project Status Engineering and material procurement activities are in progress.

Project Financing

GOP has approved the provision of sovereign guarantee for

commercial loan, terms of which are being finalized and are in

advance stages of financial close. For stop gap arrangement, Company

has secured bridge finance facility of Rs. 15 billion.

Project Completion date December, 2016

Sui Northern Gas Pipelines Limited PROJECT -2 MAP

GAS SOURCE

COMPRESSOR

STN.

EXISTING

PIPELINES PROPOSED PROJECT 2

(42”-16” Dia x 762KMs)

Summary of Pipeline

42” 70 KM

36” 303 KM

30” 109 KM

24” 145 KM

18” 65 KM

16” 70 KM

Total 762 KM 18


Power Plant Location

Quantity of

Gas required

(MMCFD)

Infrastructure Proposed Estimated Cost

(Rs. Million)

Bhikhi

(Govt. Of Punjab) 200 30” dia x 18 Km 1360

Balloki

(Govt. Of Pakistan) 200 30” dia x 8 Km 880

Haveli Bahadur Shah


Nandipur


SUPPLY OF GAS TO RLNG BASED

4000 MW POWER PLANTS


SUPPLY OF GAS TO RLNG BASED 4000 MW POWER PLANTS


THANK YOU

&

Questions, if any!

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Documents

LNG Distribution Plans Infrastructure Development - … Seminar - 11012015 (Final Presentation).pdf · LNG Distribution Plans & Infrastructure Development Pakistan Institute of Petroleum