As Pakistan blames the sanctions imposed on Iran for delaying gas intake from this country, however a Pakistani official claims there is another reason.

Pakistani Parliamentary Secretary for Petroleum and Natural Resources Shahzadi Umerzadi Tiwana said that Qatar's LNG price is lower than the price of Iran's natural gas. that of Iran.

In particular, she mentioned the recent $16-billion deal with Qatar, saying that Qatari LNG is low priced as compared to gas that Iran would be supplying to Pakistan.

According to Pakistani sources, LNG arriving in any particular month will fetch 13.37% of the preceding three-month average price of a Brent barrel (considering the present Brent price as a proxy, that would equate to $167.5 per 1000 cubic meters).

Comparing the figure with the revenues of Tehran gas deals with Turkey and Iraq, it indicates that Iranian gas wouldn't compete with Qatari LNG on Pakistani market.

In 2014 Iran was exporting gas to Turkey at above $420 per 1000 cubic meters, but the figure plunged to $225 currently due to low oil price. Iran previously said that the price of gas for Iraq would be similar to Turkey.

The price in Qatar-Pakistan's new LNG deal is very low. For instance, Tiwana said that the average price of LNG cargos imported so far by Pakistan State Oil (PSO) is $7.8224/MMBTU (million british thermal units). Converting BTU to cubic meters, then Pakistan imports 1000 cubic meters of gas at $291.

Pakistan said on February 10 that it had signed a 15-year agreement to import up to 3.75 million tons per year of LNG, or more than 14 million cubic meters per day (mcm/d) of natural gas from Qatar.

Iran also has a contract with Islamabad to export 22 mcm/d of gas to this country, while Pakistan should have started gas intake in January 2015, but yet to start construction of pipeline on its territory.

Tiwana didn't touch upon any plan regarding the Iran-Pakistan pipeline, but said that an agreement for laying gas pipeline for bringing LNG from Karachi to Lahore had already been signed between Pakistan and Russia with worth $2 billion, projected to be completed by December 2017. The project doesn't have anything to do with Iranian gas.

On the other hand, China is planning to start the construction of another pipeline from LNG terminals in Gwadar port to power plants in Navvabshah city (Pakistan).

This report is produced by Behrooz Haj Davani in EnergyPress web-base