ISLAMABAD - After dedicatedly working on import of LNG, portraying the alternative fuel as the only solution of power crisis in the country, Ministry of petroleum is in a fix as private and public sectors refused to buy it.

According to well-placed sources the decision was made after Ministry of Water and Power failed to provide guarantee of its smooth delivery and a commitment on pricing.

In order to convert power plants on some alternative fuel it requires time, if we today shift our plants on LNG and some day later the supply is disconnected, there could be a massive blackout, source said.

He said payments were another issue, which could pile up circular debts to four digits if this fuel is adopted without figuring out any proper mechanism of payments.

According to Ministry of Water and Power data the plants which could run on imported fuel include 142MW Habibullah Coastal Power Plant (Hcpc), 412 MW Roush, 229MW Orient, 365MW AES, 234MW Sapphire, 225MW Halmore 235MW Liberty, 1600MW Kapco, 29MW Altern Energy Limited, 157MW Fauji Kabirwala Power Company, Foundation Power Company 185MW.

Muzafargarh Guddu, Jamshoro, Quetta and TPS Faisalabad Gencos also have capability to generate energy on Liquefied Natural Gas.

The official said that another major contributor of the refusal was shrinking of oil in international market.

We buy furnace oil at a bit higher price as we buy on loan but still the cost of generating electricity from LNG is almost the same as the cost of RFO, why should we switch to LNG, official said.

The Central Development Working Party (CDWP) this year cleared two mega power projects of over 2200MW using imported LNG.

Combined Cycle Power Plant at Haveli Bahadur Shah, District Jhang, of 1000-1200MW and 1000-1200MW combined cycle power plant at Balloki, District Kasur, on LNG fuel worth Rs84.823b were cleared. These projects have to be completed in next two years.

Sources claim that both the projects would also have to be shifted on RFO due to cost factors, as both would not be feasible on imported costly fuel.

It is pertinent to mention that government in an apparent ambitious step went into contract with Engro Elengy Terminal Limited (ETPL) - a subsidiary of Engro Corporation, to build a terminal worth $135 million, binding government to pay penalties worth $272,000 per day to Engro, if it failed to sign a deal for the import of liquefied natural gas (LNG) with any supplier by March 31, 2015.

While signing an agreement with Qatar for the import of Liquefied Natural Gas in March 2015, Federal Minister for Petroleum and Natural Resources Shahid Khaqan Abbasi claimed the power generation cost through LNG will reduce by 40 per cent as compared to diesel.

Ministry of Petroleum has been presenting Ministry of Water and Power and CNG as the potential buyers of the alternate fuel when the policy was criticised heavily. The CNG sector is also reluctant to buy the fuel due to cost factors.

The Compressed Natural Gas was sold in kilograms, after including all our profits; we were comfortably selling it for Rs. 75 per kg, but this imported fuel prices have been revised and so is the measure; now we are selling Rs 60 per litre (one kg= 1.5 litre approx), the same is per litre price of petrol, no wonder we have no customers, said Farid Ahmed a CNG owner.

Experts believe that import of LNG was a wrong decision.

LNG is only feasible for the country which is situated at a long distance from gas reserves, for example it is best suitable for Japan, as it is far away from Qatar, but for Pakistan, due to its short distance from Qatar, pipeline is the only economical and long term solution, said Javed Iqbal Jadoon General Manager, Mari gas company.

Insiders believe that the policy was aimed to mint money by some of the businessmen in connivance with Ministry of Petroleum officials.

Initiated in 2006, the import of LNG was dedicatedly chalked out soon after Khaqan Abbasi took the charge of office as Minister Petroleum and Natural Resources.

He appointed a team which worked out all details of the import behind closed doors, working under direct supervision of then Secretary Petroleum Abid Saeed.

Abid Saeed was suspended after country faced worst petrol shortage. After Saeed, additional Secretary Arshad Mirza was elevated at the post and instead of presenting any dissenting note, the newly promoted, career officer, worked religiously hard in finalising the import, sources claimed.

Insiders claimed that millions of dollars were minted in the deal, allegedly through a middle man; former head of accountability court Saifur Rehman. According to sources Abid Saeed and present Secretary Arshad Mirza also received lions share along with Minister Khaqan Abbasi.

Some of the officials close to Saeed and Mirza claimed that both carried out the policy just to save their jobs and retire respectfully.

Secretary Petroleum and Natural resources Arshad Mirza did not responded to allegations despite many calls and text messages, neither any official from Media department bothered to answer the query sent via text.

The LNG future import is in doldrums, but the question is would anyone be held responsible for wasting national resources on a flawed policy.