Exxon Mobile and Universal Gas Distribution Company (UGDC) signed a deal on Wednesday 18th of September 2019, to import Liquefied Natural Gas (LNG) to Pakistan. The company Exxon Mobile is the world’s largest publicly traded Oil and Gas Company and the UGDC is Pakistan’s first private gas supplying company. The deal was signed in Huston, Texas by Vice President ExxonMobil Richard Rayfield and Chief Executive of UGDC Ghiyas Abdullah Paracha, whereas the Special Assistant to PM Imran Khan on Petroleum Nadeem Babar was also present at the time of signing.
Chief Executive of UGDC Mr. Paracha said that the deal would change the entire landscape for the CNG sector in Pakistan and would revive the sector in the country. He added that initially four shipments would arrive in Pakistan, starting from October, and then the imports can increase depending upon the local demand. He further added that the prices of CNG would decrease by almost 30% and that would reduce the prices of CNG in comparison to petrol. This price reduction would result in almost two million cars converting to CNG according to The UGDC estimates, said Mr. Paracha. He said that the cost of imports of fuel would be reduced by almost $1 billion because of this deal.
The signing of this deal has made a third party import CNG for Pakistan, for the first time in the country’s history. Petroleum Secretary Nadeem Babar said that ExxonMobil was investing after 20 years in the country and this would prove to be a historic moment. He added that this deal would create jobs, lower fuel prices and would positively affect Pakistan’s economy. He said that this was the PM’s vision, to make the country a pro-business center and ease operations of business in the country and hence fast track the development of Pakistan. He added that the government wanted to involve the private sector in this sector and this is the first step towards that direction. He also said that this would also encourage other oil companies to invest in Pakistan, hence increasing FDIs in the country. He added that the changed policy of the government to allow third parties to import gas would enable the CNG sector to buy surplus gas from the terminals, which would revive the CNG sector in the country.